Canada Malting Co. v. Paterson Steamships

• Decision Date: 21 July 1931
• Docket Number: No. 433-435.,433-435.
• Citation: 51 F.2d 1007
• Parties: CANADA MALTING CO., Limited, v. PATERSON STEAMSHIPS, Limited. BRITISH EMPIRE GRAIN COMPANY, Limited, v. SAME. STARNES v. SAME.
• Court: U.S. Court of Appeals — Second Circuit

51 F.2d 1007 (1931)

CANADA MALTING CO., Limited, v. PATERSON STEAMSHIPS, Limited.

BRITISH EMPIRE GRAIN COMPANY, Limited, v. SAME.

STARNES v. SAME.

Nos. 433-435.

Circuit Court of Appeals, Second Circuit.

July 21, 1931.

Bigham, Englar, Jones & Houston, of New York City (Leonard J. Matteson, of New York City, Laurence E. Coffey, of Buffalo, N. Y., and Andrew J. McElhinney, of New York City, of counsel), for appellants.

Stanley & Gidley, of Buffalo, N. Y., for appellee.

Before MANTON, SWAN, and CHASE, Circuit Judges.

SWAN, Circuit Judge.

These cases come before us upon the allegations of the libels, admitted by respondent's exceptions, and upon the facts stated in supporting and opposing affidavits filed on the motion to decline jurisdiction and dismiss the libels. The three suits are alike. Each libelant was an owner of cargo shipped under a Canadian bill of lading for transportation on the steamer Yorkton from one Canadian port to another, and lost in consequence of a collision between the carrying vessel and the respondent's steamer Mantadoc. The collision was alleged to have been caused by faults of the Mantadoc. It occurred in Lake Superior on the American side of the international boundary, and the Yorkton was so badly damaged that she sank; her cargo becoming a total loss. Both vessels were of Canadian registry, and each was owned by a Canadian corporation. An investigation conducted at Toronto by the Dominion Wreck Commissioner resulted in a finding that the masters of both vessels were at fault. Immediately after the libels were filed in the court below, the respondent began a suit, which is still pending, in a Canadian admiralty court against the owner of the Yorkton, to recover collision damages suffered by the Mantadoc.

Upon the filing of the libels and the seizure under writ of foreign attachment of the respondent's vessel Lachinedoc at the port of Buffalo, the respondent appeared generally and filed stipulations for release of its vessel. Before the return day it excepted to the libels and moved for a dismissal of the suits. After hearing upon libels, exceptions, and affidavits, the motion was granted.

Not only are the libelants and the respondent Canadian subjects, but the officers and most, if not all, the members of the crew of each vessel are residents of Canada and so not available for compulsory attendance as witnesses in the District Court. This was considered an important consideration by the court below, as was also the fact that under our law an innocent cargo owner can recover full damages from the noncarrying vessel, if both the colliding vessels were at fault (The New York, 175 U. S. 187, 209, 20 S. Ct. 67, 44 L. Ed. 126), while, under the Canadian law, it is asserted, only half damages would be recoverable from the respondent. The Yorkton has been salvaged, and it is contended by libelants that under the rule of The Chattahooche, 173 U. S. 540, 19 S. Ct. 491, 43 L. Ed. 801, the respondent could implead the owner of the Yorkton and recoup one-half of its liability to cargo owners, but there is a dispute whether the salved value of the Yorkton would afford the respondent adequate protection so that the maintenance of the libels here would be no more disadvantage financially than suits by the cargo owners in Canada. The respondent offered, if the libelants were remitted to their home forum, to appear and give adequate security in any suits they might there bring upon their cargo claims, and the decrees below directed the respondent to perform this offer. No one has questioned this feature of the decrees, and we say nothing as to it.

The appellants advance two propositions as reasons for reversal of the decrees of dismissal: First, that the District Court had no discretion to decline jurisdiction; and, second, that, even if it had, dismissal of the suits was an abuse of discretion.

The argument in support of the first proposition is grounded upon the assertion that, since the collision occurred within territorial waters of the United States, the rights and obligations of the parties are to be determined by the law of the place where the tort was committed. Smith v. Condry, 1 How. 28, 32, 11 L. Ed. 35; Slater v. Mexican National R. R. Co., 194 U. S. 120, 126, 24 S. Ct. 581, 48 L. Ed. 900; New York Central v. Chisholm, 268 U. S. 29, 32, 45 S. Ct. 402, 69 L. Ed. 828, 38 A. L. R. 1048. It is conceded that in suits between foreigners a court of admiralty may for good cause decline to retain jurisdiction provided the law to be applied is foreign law, but it is contended that, when a maritime tort is governed by the law of the forum, retention of jurisdiction is mandatory.

The most recent statements of the Supreme Court upon the subject do not assert the limitation for which the appellants contend. In Charter Shipping Co. v. Bowring, 281 U. S. 515, 517, 50 S. Ct. 400, 401, 74 L. Ed. 1008, it is said: "The retention of jurisdiction of a suit in admiralty between foreigners is within the discretion of the District Court. The exercise of its discretion may not be disturbed unless abused. The Belgenland, 114 U. S. 355, 368, 5 S. Ct. 860, 29 L. Ed. 152; The Maggie Hammond, 9 Wall. 435, 457, 19 L. Ed. 772."

A similarly broad dictum is repeated in Langnes v. Green, 282 U. S. 531, 544, 51 S. Ct. 243, 248, 75 L. Ed. 520, where it is said that, although admiralty courts have complete jurisdiction over suits of a maritime nature between foreigners, "nevertheless, `the question is one of discretion in every case, and the court will not take cognizance of the case if justice would be as well done by remitting the parties to their home forum.'"

But the appellants contend that these statements should not be given so broad a scope as they bear on their face. In the Bowring Case foreign law was involved, as the court noticed in a paragraph of its opinion which appears on page 518 of 281 U. S., 50 S. Ct. 400, 401: "Both the parties being British subjects and the present litigation, as well as the suit pending abroad, apparently involving the application of English law to the fund located there, it was for the District Court to say, as it did, upon a consideration of all the circumstances, whether it should decline `to take cognizance of the case if justice would be done as well by remitting the parties to the home forum.' See The Maggie Hammond, supra, page 457 of 9 Wall., 19 L. Ed. 772."

Similarly, the...