THE THOMAS BARLUM, 1795
| Citation | 2 F. Supp. 733 |
| Decision Date | 09 March 1933 |
| Docket Number | 1794.,No. 1795,1795 |
| Parties | THE THOMAS BARLUM. THE JOHN J. BARLUM. DETROIT TRUST CO. v. BARLUM S. S. CO. (two cases). |
| Court | U.S. District Court — Western District of New York |
Miller, Canfield, Paddock & Stone, of Detroit, Mich., and Stanley & Gidley, of Buffalo, N. Y. (Ray M. Stanley, of Buffalo, N. Y., of counsel), for libelant.
George E. Brand, of Detroit, Mich., and Thomas C. Burke and Charles S. Desmond, both of Buffalo, N. Y., for claimant.
These actions were brought to foreclose in admiralty two preferred mortgages, executed and delivered by the Barlum Steamship Company, covering the steamers Thomas Barlum and John J. Barlum under the provisions of the Ship Mortgage Act § 30 D et seq. (chapter 25, title 46, § 922 and succeeding sections, of the United States Code Annotated). Each of the mortgages is for $200,000.
The two actions are identical except for the names of the vessels and the disposition of the amounts involved. Upon the filing of the libels, the mortgagor appeared as claimant and filed exceptions in each case. The exceptions questioned the jurisdiction of the United States District Court upon the ground that Congress had no power under the Constitution to increase and extend the admiralty and maritime jurisdiction of the federal courts, by bringing within such jurisdiction things nonmaritime, to wit, mortgages on ships. This court overruled those exceptions and held the Ship Mortgage Act providing for foreclosure of preferred mortgages on ships to be constitutional. Detroit Trust Company v. Barlum S. S. Co. (D. C.) 56 F.(2d) 455. Thereafter the claimant answered in the actions setting up two separate defenses: First, that the proceeds of the loans, as security for which these mortgages were given, were used almost entirely for nonmaritime purposes, such as real estate loans, to the knowledge of libelant when the mortgages were given. Second, that the foreclosure provision of the Ship Mortgage Act is unconstitutional. Thereupon the libelant in turn excepted to the two defenses set up in the answer. This court, after a hearing, sustained libelant's exceptions to the second defense, in accordance with its opinion above cited holding the Ship Mortgage Act constitutional. Libelant's exceptions to the first defense were overruled and the cases went to trial on the question whether the fact allegations in the first defense, to wit, that the proceeds of the loans as security for which these mortgages were given were used almost entirely for nonmaritime purposes, raised a triable issue as to the actual character of these particular mortgages.
On the trial it was shown that a considerable part of the proceeds of each of the $200,000 mortgages was applied by the mortgagor, or by agreement between the mortgagor and the mortgagee, to nonmaritime purposes.
Proctors for the claimant in their brief argue ably against the...
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The Thomas Barlum the John Barlum Detroit Trust Co v. Barlum Co
...that contention and, finding that all the requirements of that Act had been met, entered decrees of foreclosure and sale. 56 F.(2d) 455; 2 F.Supp. 733. In the case of the John J. Barlum the decree provided for the recovery by certain seamen, intervening libelants, of amounts due for wages, ......