In re WE Hedger Co.

• Decision Date: 13 June 1932
• Docket Number: No. 377.,377.
• Citation: 59 F.2d 982
• Parties: In re W. E. HEDGER CO., Inc.
• Court: U.S. Court of Appeals — Second Circuit

59 F.2d 982 (1932)

In re W. E. HEDGER CO., Inc.

No. 377.

Circuit Court of Appeals, Second Circuit.

June 13, 1932.

William F. Purdy, of New York City (Edmund F. Lamb, of New York City, of counsel), for appellant.

Single & Single and Macklin, Brown, Lenahan & Speer, all of New York City (Horace L. Cheyney and Thomas H. Middleton, both of New York City, of counsel), for appellee.

Before MANTON, SWAN, and CHASE, Circuit Judges.

SWAN, Circuit Judge.

The steam tug Frederick Lennig, while towing four loaded barges from New York to Buffalo, brought its tow into collision with Lock 9 on the New York State Barge Canal, resulting in damage to certain of the barges. They were owned by the damage claimant, Foster. This court, by its decision reported in 45 F.(2d) 691, held that the accident occurred through negligence in the operation of the tug, but granted the appellant the right to limit its liability. Thereafter a hearing was had before a special commissioner appointed to take proof as to the value of the appellant's interest in the tug and her pending freight. He found the value of the tug to be $2,100, and the value of the petitioner's interest in her freight then pending to be $3,640.96. These findings the District Court confirmed and carried into its final decree.

This appeal questions only the amount of freight to be surrendered. Two contentions are presented: First, that the total freight collected by the appellant for the voyage from New York to Buffalo was earned by the combined services of tug and barges, and that only 55 per cent. thereof should be allotted as the tug's share; second, that from the gross freight earned by the tug should be deducted the expense incurred after the accident in operating the tug to complete the voyage to Buffalo and thus earn the freight. These contentions will be considered seriatim.

The privilege of limiting liability is granted the owner of an offending vessel on condition that he surrender the value of his interest in "such vessel, and her freight then pending." Rev. St. § 4283, 46 USCA § 183. In the case of a flotilla consisting of tug and tow, the vessel required to be surrendered will, in some circumstances, be only the tug, as in Liverpool, etc., Nav. Co. v. Brooklyn Eastern Dist. Terminal, 251 U. S. 48, 40 S. Ct. 66, 64 L. Ed. 130, while in other circumstances it will be the whole flotilla. The Columbia, 73 F. 226 (C. C. A. 9), approved in Sacramento Nav. Co. v. Salz, 273 U. S. 326, 332, 47 S. Ct. 368, 71 L. Ed. 663. In the case at bar, it is conceded that the tug alone constitutes the vessel to be surrendered. The petitioner had no interest in the barges. When a tug and tow together comprise the instrument of transportation earning freight but the tug alone is the vessel to be surrendered, what is "such vessel's" freight then pending? The question is not free from difficulty, but no attempt to make a comprehensive answer is required by the present litigation. This case must turn on a matter of proof. The petitioner in a limitation proceeding has the burden of proving compliance with the conditions which entitle him to limit liability. The Rambler, 290 F. 791, 792 (C. C. A. 2). He must show the value of his interest in the vessel and her pending freight. When a tug owner proves that he collected a certain sum as freight and that he had no interest in the cargo-carrying barges, we think the sum collected necessarily measures his interest in freight earned by the tug, in the absence of a showing that others are entitled to share in the freight he collected. Such a showing the appellant attempted to make, but the court below thought it insufficient, and with this we agree.

The contract of affreightment is not in evidence, but it appears from the testimony that the entire freight was prepaid to the appellant, and that the latter apportioned it upon its books in the ratio of 55 per cent. to the tug and 45 per cent. to the barges. Actually the barges did not participate in the freight. They were under charter on a per diem hire to Hedger Transportation Company, which was a different corporation from the appellant although the same individuals were officers and directors of both. The transportation company was described...