285 U.S. 413 (1932), 487, Canada Malting Co., Ltd. v. Paterson Steamships, Ltd.

Docket Nº:No. 487
Citation:285 U.S. 413, 52 S.Ct. 413, 76 L.Ed. 837
Party Name:Canada Malting Co., Ltd. v. Paterson Steamships, Ltd.
Case Date:April 11, 1932
Court:United States Supreme Court
 
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Page 413

285 U.S. 413 (1932)

52 S.Ct. 413, 76 L.Ed. 837

Canada Malting Co., Ltd.

v.

Paterson Steamships, Ltd.

No. 487

United States Supreme Court

April 11, 1932

Argued February 25, 1932

CERTIORARI TO THE CIRCUIT COURT OF APPEALS

FOR THE SECOND CIRCUIT

Syllabus

1. In a suit in admiralty between foreigners, it is ordinarily within the discretion of the district court to refuse to retain jurisdiction, and the exercise of its discretion will not be disturbed unless abused. P. 418.

2. This rule applies even though the cause of action arose in this country. Pp. 418-419.

3. Two ships of Canadian registry and ownership, each carrying cargo shipped from one Canadian port to another, collided on Lake Superior while unintentionally in United States waters, and one ship sank. While suit was pending in a Canadian court of admiralty to determine liability as between the ships, libels in personam against the owner of one of them were filed by cargo owners in a federal district court in New York. All the parties were citizens of Canada, and the officers and crew of each vessel -- the material witnesses -- were citizens and residents of tat country. Opposing affidavits alleged that the motive of the cargo owners in coming to a court of the United States lay in the opportunity in our law to recover full damages from the noncarrying vessel, whereas, in Canada, the liability would be divided equally between the two vessels if both were at fault. The district court dismissed the libels, but ordered that the respondent should appear and file security in any action which might be instituted by the libelants in the admiralty

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courts of Canada, so that they would not, by dismissal of the libels, lose the security gained by foreign attachment.

Held that the refusal to retain jurisdiction was not an abuse of discretion. P. 423.

51 F.2d 1007 affirmed.

Certiorari, 284 U.S. 612, to review the affirmance of decrees dismissing three libels in admiralty. 49 F.2d 802, 804.

Page 417

BRANDEIS, J., lead opinion

MR. JUSTICE BRANDEIS delivered the opinion of the Court.

These three libels in admiralty in personam were brought in the federal court for western New York by owners of cargo laden on the steamer Yorkton to recover for loss resulting from the sinking of that vessel in a collision with respondent's steamer Mantadoc in Lake Superior on the American side of the international boundary line. The respondent moved, in each case, that the district court exercise its discretion to decline jurisdiction and dismiss the libels on the ground that all the parties were citizens of Canada, and that the controversy concerned "matters . . . properly the subjects of hearing and determination" by the Canadian courts. The motions were granted, 49 F.2d 802, 804, and the decrees of the district court were affirmed by the Circuit Court of Appeals for the Second Circuit, 51 F.2d 1007. This Court granted certiorari.

Shortly after the collision, the Wreck Commissioner of Canada held a formal investigation, as required by law, respecting the circumstances of the collision, and determined that the masters of both vessels were at fault. The respondent then instituted in the Admiralty Court of Canada a proceeding for the judicial determination of the liability as between the colliding vessels and their owners.

Page 418

The libelants' motive for invoking the jurisdiction of a court of the United States instead of that of the Canadian court in which that proceeding was pending appears in affidavits filed with the exceptions to the libel. Under the Canadian law, it is stated, if both colliding vessels were at fault, each vessel would be liable for not more than half of the loss, and the salvaged value of the Yorkton might not suffice to pay its share. See The Milan, Lush.Adm. 401. Under our law, the innocent cargo owner can recover full [52 S.Ct. 414] damages from the noncarrying vessel. The New York, 175 U.S. 187, 209-210.

The libelants concede, as they must, that in a suit in admiralty between foreigners it is ordinarily within the discretion of the district court to refuse to retain jurisdiction, and that the exercise of its discretion will not be disturbed unless abused. Charter Shipping Co. v. Bowring, Jones & Tidy, Ltd., 281 U.S. 515, 517. Compare Watts, Watts & Co. v. Unione Austriaca di Navigazione, 248 U.S. 9; Langnes v. Green, 282 U.S. 531, 544. They claim, however, that the rule is not applicable here, since the cause of action arose within the territorial limits of the United States, and, moreover, that if the District Court had discretion, the decrees should be reversed because, on the undisputed facts, it was an abuse of discretion to decline jurisdiction. We are of opinion that neither claim is well founded.

First. The contention that the jurisdiction was obligatory rests upon the fact that the collision occurred within the territorial waters of the United States. The argument is that a cause of action arising from a collision occurring on territorial waters of the United States arises out of its laws, since within its territory there can be no other law, Smith v. Condry, 1 How. 28, 33; Slater v. Mexican National R. Co., 194 U.S. 120, 126; New York Central R. Co. v. Chisholm, 268 U.S. 29, 32; that the Constitution, Art. III, § 2, cl. 1, extends the judicial

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power to "all cases of admiralty and maritime Jurisdiction;" that § 24 of the Judicial Code confers upon the district court jurisdiction "of all civil causes of admiralty and maritime jurisdiction;" and that, by vesting jurisdiction in that court, Congress imposed a duty upon it to exercise the jurisdiction. Cohens v. Virginia, 6 Wheat. 264, 404; McClellan v. Carland, 217 U.S. 268, 281; Second Employers' Liability Case, 223 U.S. 1, 58-59,. In support of the argument that there is no power to decline jurisdiction in cases where the cause of action arose within the United States, the libelants urge the statement in The Belgenland, 114 U.S. 355, 365, that

the courts will use a discretion about assuming jurisdiction of controversies between foreigners in cases arising beyond the territorial jurisdiction of the country to which the courts belong.

The respondent insists that the doctrine of lex loci delicti has no application to cases of collision on the Great Lakes; that the Great Lakes and their connecting channels constitute public navigable waters, irrespective of the location of the international boundary, and possess all the characteristics of the high seas, The Eagle, 8 Wall. 15, 22; United States v. Rodgers, 150 U.S. 249, 256; Panama R. Co. v. Napier Shipping Co., 166 U.S. 280, 285; The New York, 175 U.S. 187; The Robert W. Parsons, 191 U.S. 17, 27; that, in a case of collision on the high seas between two vessels of the same nationality, liability is governed by the law of the flag, The Scotland, 105 U.S. 24, 29-30; The Eagle Point, 142 F. 453, 454; that the Canadian law would apply in the cases at bar, and that, hence, the asserted ground for the district court's retaining jurisdiction fails.

We have no occasion to inquire by what law the rights of the parties are governed, as we are of the opinion that, under any view of that question, it lay within the discretion of the district court to decline to assume jurisdiction

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over the controversy. The suggestion drawn from the language in The Belgenland, supra, that such discretion exists only "in cases arising beyond the territorial jurisdiction of the country to which the courts belong" is without support in either the earlier or the later decisions of this Court. Nor is it justified by the language relied on, when that language is read in its context. The case of The Belgenland arose out of a collision on the high seas between foreign vessels of different nationalities, and the objection was raised that the courts of the United States were wholly without jurisdiction. Mr. Justice Bradley, speaking for the Court, replied that jurisdiction in admiralty did exist over...

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