Petition of Goulandris, 226.
| Decision Date | 10 February 1944 |
| Docket Number | No. 226.,226. |
| Citation | 140 F.2d 780 |
| Parties | Petition of GOULANDRIS et al. THE IOANNIS P. GOULANDRIS. |
| Court | U.S. Court of Appeals — Second Circuit |
Reid, Cunningham & Freehill, of New York City (James E. Freehill, I. Maurice Wormser, and Renato C. Giallorenzi, all of New York City, of counsel), for appellants.
Bigham, Englar, Jones & Houston, of New York City (Henry N. Longley and John W. R. Zisgen, both of New York City, of counsel), for claimants-appellees.
Before SWAN, CLARK, and FRANK, Circuit Judges.
This is an appeal from a decree dismissing a petition for limitation of liability. The case appears to be one of first impression. It involves a construction of the 1936 amendment of the Limitation of Liability Act, 46 U.S.C.A. § 185, which is printed in the margin in its amended form.1 Before the amendment the rule was firmly established that a shipowner might litigate with adverse claimants the question of his liability, and even after final judgment had gone against him might still file his petition for limitation. The Benefactor, 103 U.S. 239, 26 L.Ed. 351; Larsen v. Northland Transportation Co., 292 U.S. 20, 54 S.Ct. 584, 78 L.Ed. 1096. The amendment requires the petition for limitation to be filed within six months after a claimant shall have given the shipowner written notice of claim. It is conceded by the plaintiff that the purpose of the six months provision was to change the old rule and require the shipowner to act promptly in asserting the right to limit his liability. That this was the legislative purpose has been generally recognized. The Fred Smartley, Jr., 4 Cir., 108 F.2d 603, 607, certiorari denied 309 U.S. 683, 60 S.Ct. 724, 84 L.Ed. 1027; The Grasselli Chemical Co. No. 4, D.C.S.D.N.Y., 20 F.Supp. 394, 395; The Bright, D.C.Md., 38 F.Supp. 574, 577, affirmed 4 Cir., 124 F.2d 45; Benedict, Admiralty 6th ed. § 483.
In the case at bar the petition was filed on November 3, 1941, which was one day before the six months period expired. It was accompanied by a stipulation for costs in the sum of $250; but the petitioners did not, within the six months or at any time before the decree of dismissal, "deposit with the court, for the benefit of claimants, a sum equal to the amount or value of the interest of such owner in the vessel or freight, or approved security therefor", nor did they transfer their interest in the vessel and freight to a trustee appointed by the court. The district court construed the statute to require them within the prescribed six months not only to file their petition but also to transfer their interest in the vessel and her pending freight or to deposit its value or give approved security therefor.
The appellants contend here, as they did in the district court, that the statute requires merely the filing of the petition within the six months period, leaving undisturbed the power of the court to determine in accordance with its established rules of practice the amount of the appropriate limitation fund and the date when it must be furnished. They base their argument upon general Admiralty Rule 51, 28 U.S.C.A. following section 723 and a statement in House Report No. 2517 of the 74th Congress 2d session. This report after reviewing the proposed amendment concludes with the statement: "With the exception of the provision relating to the time for filing the petition for limitation of liability, and the provision relating to the additional sums which must be turned over, either to Court or the Trustee, the proposed Amendment in substance follows Rule 51 of the United States Supreme Court Admiralty Rules." Admiralty Rule 51 provides that the shipowner may file a petition "setting forth the facts and circumstances on which said limitation of liability is claimed, and praying proper relief in that behalf; and thereupon said court, having caused due appraisement to be had of the amount or value of the interest of said owner or owners, respectively, in such ship or vessel and her freight, for the voyage, shall make an order for the payment of the same into court, or for the giving of a stipulation with sufficient sureties * * * for the payment thereof into court with interest * * *; and, upon compliance with such order, the said court shall issue a monition against all persons claiming damages * * *." Since the rule contemplates that "due appraisement" and a court order shall precede the giving of security, the appellants urge that if the security must be furnished within the six months period allowed by the present statute for filing the petition, the time for initiating the limitation proceeding will necessarily be reduced to less than the specified six months, contrary to the expressed intent of the statute. Attention is called to Ore Steamship Corp. v. D/S A/S Hassel, 2 Cir., 137 F.2d 326, 329, where this court held that a statute requiring a suit for cargo damage to be brought within one year after delivery of the cargo was satisfied by the filing of a libel, although the court's jurisdiction to proceed either in rem or in personam does not exist until seizure of the vessel or service of process. The appellants, who reside in Greece, also stress the hardship resulting from the court's construction of the statute, because they were unable either to surrender the vessel, which had been requisitioned by the Greek Government, or to post security for its value since their funds in the United States had been "frozen" by a Presidential order effective April 28, 1941.2
But in urging these arguments the appellants disregard the fact that the prayer of their petition for limitation of liability is peculiar and not in the usual form. Thus paragraph (1) of the prayer asked the court "upon further application of the petitioners" to cause due appraisement to be...
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