Petition of Red Star Barge Line

• Decision Date: 16 June 1947
• Docket Number: No. 207,Docket 20511.,207
• Citation: 160 F.2d 436
• Parties: Petition of RED STAR BARGE LINE, Inc., et al. The RED STAR 40.
• Court: U.S. Court of Appeals — Second Circuit

160 F.2d 436 (1947)

Petition of RED STAR BARGE LINE, Inc., et al. The RED STAR 40.

No. 207, Docket 20511.

Circuit Court of Appeals, Second Circuit.

March 31, 1947.

Writ of Certiorari Denied June 16, 1947.

Alexander & Ash, of New York City (Edward Ash and Sidney A. Schwartz, both of New York City, of counsel), for appellants.

Nachamie & Benjamin, of New York City (Leonard Bronner, Jr., of New York City, and Harold L. Haskin, of Hempstead, N. Y., of counsel), for appellee.

Before SWAN, CHASE and FRANK, Circuit Judges.

Writ of Certiorari Denied June 16, 1947. See 67 S.Ct. 1741.

SWAN, Circuit Judge.

The question presented by this appeal is whether the district court abused discretion in vacating a previously granted restraining order and permitting the appellee to prosecute an action in the state court against the appellants and others, although the appellee had not formally admitted in the limitation proceeding the appellants' right to limit their liability to the value of the coalboat and its pending freight.

The appellants are the owner and charterer, respectively, of the coalboat "Red Star 40." On December 11, 1945 Arthur Force was in the employ of the charterer as bargee of the coalboat which lay in navigable waters at Pier 18, Jersey City, New Jersey. While the boat was being shifted to another berth by a tug which was neither owned nor operated by either of the appellants, the operation was so conducted that the bargee was knocked overboard and sustained injuries resulting in his death. His widow having made claim against the charterer of the coal-boat, the appellants, within the time permitted by the statute, 46 U.S.C.A. § 185, filed their petition for limitation of, and exoneration from, liability and obtained an order for the issuance of a monition to damage-claimants and the usual restraining order against the prosecution of their claims except in this proceeding. Thereafter the bargee's widow, who had been appointed his administratrix by the Surrogate's Court of Nassau County, New York, moved to vacate the restraining order so that she might bring suit in the state court against the appellants and the owners and operators of the tug on the ground that decedent's injuries and death were caused by their negligence. Prior to making the motion she had neither filed her claim in the limitation proceeding nor answered the petition which alleged that the accident happened without the petitioners' privity or knowledge. Her supporting affidavit stated that she did not intend to question the value placed by the petitioners upon the coalboat and its pending freight, but intended to bring suit for a sum in excess of such value; and that she intends to contest the petitioners' right to limitation "should that be necessary," but there will be no need to litigate the question unless she secures a judgment against the petitioners for an amount in excess of the limitation fund, and she "does not question" their "right to litigate the Limitation Proceedings in the Federal Courts." After hearing argument of counsel, the district judge granted the motion and signed an order which (1) dissolved the previously entered restraining order, (2) permitted the movant to commence and prosecute her contemplated action in the state court, (3) required her promptly to file her proof of claim in the limitation proceeding,¹ (4) extended her time to answer the limitation petition until after termination of the state court action, (5) conditioned the order upon her concession of the correctness of the limitation fund, i. e., $7,267 with interest from December 11, 1945, (6) stayed the petitioners from taking further steps in the limitation proceeding until final adjudication in the state court action, and (7) reserved jurisdiction of the petition to limit liability. From this order the petitioners appealed.

Since the accident resulted in only one possible claim against the limitation petitioners, the appellee's right to sue in a state court, where she can obtain the advantage of a jury trial, could not be doubted, if she had filed in the limitation proceeding her consent to the petitioners' right to limit liability, as was done in W. E. Hedger Transp. Corp. v. Gallotta, 2 Cir., 145 F.2d 870, 872. The appellants contend that she should have been required to concede their right of limitation as a condition precedent to any modification of the restraining order. It is true that in several cases where the restraining order has been vacated to permit the claimant to sue in a state court, it appears that he has previously conceded the right to limit. See W. E. Hedger Transp. Corp. v. Gallotta, supra; The Helen L., 9 Cir., 109 F.2d 884, 885; The Kearny,...