United States M. & S. Ins. Co. v. A/S DEN NORSKE A. OG A. LINE

• Decision Date: 29 May 1933
• Docket Number: No. 285.,285.
• Citation: 65 F.2d 392
• Parties: UNITED STATES MERCHANTS' & SHIPPERS' INS. CO. v. A/S DEN NORSKE AFRIKA OG AUSTRALIE LINE.
• Court: U.S. Court of Appeals — Second Circuit

65 F.2d 392 (1933)

UNITED STATES MERCHANTS' & SHIPPERS' INS. CO. v. A/S DEN NORSKE AFRIKA OG AUSTRALIE LINE.

No. 285.

Circuit Court of Appeals, Second Circuit.

May 29, 1933.

Bigham, Engler, Jones & Houston, of New York City (Henry N. Longley and F. Herbert Prem, both of New York City, of counsel), for appellant.

Haight, Smith, Griffin & Deming, of New York City (Charles S. Haight, John W. Griffin, and Wharton Poor, all of New York City, of counsel), for appellee.

Before L. HAND, SWAN, and CHASE, Circuit Judges.

L. HAND, Circuit Judge.

The libellant is an American corporation, the underwriter of the Dutch shipper of a parcel of goods, laden in a ship of the respondent, a Norwegian corporation. The ship was upon a voyage from Oslo to China ports, and lifted the parcel in question at Hamburg. When some days out from Colombo she caught fire and became a total loss. The libellant paid the shipper under the policy, and brought this suit in its own name as subrogate. The bill of lading under which the parcel was shipped contained the following clause: "All questions arising under this bill of lading are to be governed by the law of Norway, and to be decided in Oslo." By the last we understand any competent Norwegian court of that city. The respondent appeared specially for the purpose of disputing the jurisdiction, which the judge held to lie in his discretion. He dismissed the libel because he thought the balance of convenience was greatly in favor of a Norwegian trial. The libellant does not dispute that if he was right in point of law, we may not reverse his decree for abuse of discretion; thus the only questions which arise are whether an American underwriter who has paid the loss of a foreign shipper under such a bill of lading may as matter of right sue a foreign owner in an American court, and if so, whether the suit should be stayed until the Norwegian court has decided the controversy.

Both sides concede that had the Dutch shipper itself moved in the suit, jurisdiction would have depended upon the discretion of the court; each party would have been an alien, and the District Court is not obliged to try such cases; its jurisdiction depends upon whether its exercise is essential to justice; whether the libellant is driven to seek it in order to secure any adequate redress at all. Canada Malting Co. v. Paterson S. S., 285 U. S. 413, 52 S. Ct. 413, 76 L. Ed. 837; Charter Shipping Co. v. Bowring, 281 U. S. 515, 50 S. Ct. 400, 74 L. Ed. 1008; The Belgenland, 114 U. S. 355, 5 S. Ct. 860, 29 L. Ed. 152. But the libellant is a citizen and asserts its absolute privilege of resort to its own courts, independently of any inconvenience to the respondent. How far such inconvenience can be recognized, depends upon the local procedure which at times does indeed protect a non-resident from local suit. Courts are maintained to give redress primarily to their own citizens; it is enough if these conform to the conditions set upon their jurisdiction. All this is entirely true, and would be conclusive, if the libellant sued in its own right. The question is whether it is equally true, when it sues as subrogate. In general, so all admit, the surety in such a case stands in the place of his principal; his rights are the same; defenses good against the principal are good against him. Phœnix Ins. Co. v. Erie & Western Transp. Co., 117 U. S. 312, 6 S. Ct. 750, 29 L. Ed. 873; U. S. v. American Tobacco Co., 166 U. S. 468, 17 S. Ct. 619, 41 L. Ed. 1081; The City of Brunswick, 1933 A. M. C. 61 (Ct. Cl.); Simpson v. Thomson, 3 App. Cas. 379. The doctrine is too well settled to labor, and the case at bar would fall directly within it, were the question strictly one of right; it is not, but one of remedy. Indeed, it is strictly not even that, for it does not touch what remedies are available, but what tribunals shall be competent to grant any remedies at all; or even more narrowly, whether those concededly so competent, shall exercise their jurisdiction.

The point, so far as we can find, has never before arisen in any court. The nearest decision is Société du Gaz, etc., v. Armateurs Francais, 1926 Sessions Cases, 16. Suit was there brought in a Scotch court by an English underwriter in the name of a French shipper against a French shipowner. The Scotch courts refused jurisdiction, and were affirmed by the House of Lords. How far the result depended on the fact that the real plaintiff was not a Scotchman does not certainly appear, though it was mentioned by some of the judges. Nor can we extract any general doctrine from what was said; certainly it will not serve as a decision upon the facts at bar. At least, we cannot suppose that the accident of procedure was determinative; that is, because the underwriter sued, and we assume was obliged to sue, in the name of the shipper. We should hesitate to decide that questions of jurisdiction depended upon rules as to who must be the formal party. Again, we cannot consider important those cases in which colorable assignments, given to avoid limitations upon jurisdiction, were held not to do so; Goldman v. Furness, Withy & Co. (D. C.) 101 F. 467; Wittig v. Canada S. S. Lines (D. C.) 59 F.(2d) 428; The Lady Drake (D. C.) 1 F. Supp. 317. Such simple evasions certainly could not succeed; they throw no light upon the situation now at bar. In Fairgrieve v. Marine Ins. Co. of London, 94 F. 686 (C. C. A. 8), the underwriter was an alien; the case was clearly...