Phoenix Ins. Co. v. United States

• Decision Date: 30 December 1932
• Docket Number: No. 3496.,3496.
• Citation: 3 F. Supp. 112
• Court: U.S. District Court — District of Connecticut
• Parties: PHŒNIX INS. CO. OF HARTFORD v. UNITED STATES.

3 F. Supp. 112

PHŒNIX INS. CO. OF HARTFORD v. UNITED STATES.

No. 3496.

District Court, D. Connecticut.

December 30, 1932.

Bigham, Englar, Jones & Houston, of New York City (F. Herbert Prem and Alfred Ogden, both of New York City, of counsel), for plaintiff.

John Buckley, U. S. Atty. and George H. Cohen, Asst. U. S. Atty., both of Hartford, Conn., and Charles E. Wythe, Sp. Asst. U. S. Atty., of New York City.

HINCKS, District Judge.

This matter comes before the court on the respondent's exceptions to the libel.

The libel alleges a cause of action in damages for breach of a maritime contract of carriage, cargo damage, and general average arising out of a shipment of wire rods on June 12, 1920, by the steamship Naiwa, owned and operated by the respondent; that in August, 1926, the Japanese consignee of the shipment and owner of the cargo instituted an action in admiralty against the United States Shipping Board Emergency Fleet Corporation in the United States District Court for the Eastern District of South Carolina, which action, although commenced within the statutory period of limitations for common-law actions against the United States cognizable in the Court of Claims, was dismissed in May, 1932, because not commenced within the time prescribed by the Suits in Admiralty Act, approved March 9, 1920 (46 USCA § 741 et seq.); that the shipment out of which the cause of action aforesaid arose was insured by the libelant herein, which by its policy became obligated to pay and did pay $5,784.41 to the Japanese consignee, the assured, on account of its damage and loss, whereby the libelant became subrogated to the rights of its assured, the Japanese consignee, against said respondent.

The Naiwa, it is established by affidavit, is no longer in existence, having been scrapped in August, 1929.

To this libel the respondent excepts on the ground that it does not state a cause of action against the respondent, and that the libel does not show that the libelant herein had brought a suit in admiralty, or an action at law, or an action under the Tucker Act of March 3, 1887 (24 Stat. 505), within the statutory period of limitation for common-law actions against the United States cognizable in the Court of Claims.

These exceptions thus raise the question whether the libel herein is within the scope of the Act of June 30, 1932 (47 Stat. 420), amending section 5 of the Suits in Admiralty Act of March 9, 1920, 41 Stat. 526, 46 USCA § 745. The Act of 1920, § 5, had limited actions thereunder to a period of two years. The amendment of June 30, 1932, provided:

"Suits as authorized in this chapter shall be brought within two years after the cause of action arises: Provided further, That the limitations in this section contained for the commencement of suits hereunder shall not bar any suit against the United States or the United States Shipping Board Merchant Fleet Corporation, formerly known as the United States Shipping Board Emergency Fleet Corporation, brought hereunder on or before December 31, 1932, if such suit is based upon a cause of action whereon a prior suit in admiralty or an action at law or an action under subdivision (1) of section 250 of Title 28, was commenced prior to January 6, 1930, and was or may hereafter be dismissed because not commenced within the time or in the manner prescribed in this section, or otherwise not commenced or prosecuted in accordance with its provisions: Provided further, That such prior suit must have been commenced within the statutory period of limitation for common-law actions against the United States cognizable in the Court of Claims: Provided further, That there shall not be revived hereby any suit at law, in admiralty, or under subdivision (1) of section 250 of Title 28 heretofore or hereafter dismissed for lack of prosecution after filing of suit."

Specifically, the question framed is whether this libel "is based upon" the same "cause of action" as the earlier libel brought by and in the name of the Japanese consignee as set forth in the libel. If so, the exceptions must be overruled; otherwise sustained.

The committee reports to the Congress, recommending the adoption of the 1932 amendment, state, in substance, that the Suits in Admiralty Act of 1920 for almost a decade after its passage was interpreted by the federal courts as not affecting the pre-existing remedies of claimants against the United States or its agencies, the Shipping Board and Fleet Corporation, either at common law or in admiralty in the state and federal courts; that during this period in many actions, brought other than under the Suits in Admiralty Act, settlements and judgments were obtained against and paid by the Shipping Board; that on January 6, 1930, in the case of Johnson v. U. S. Shipping Board, 280 U. S. 320, 50 S. Ct. 118, 74 L. Ed. 451, the Supreme Court of the United States had held that the remedy afforded by the Suits in Admiralty Act was exclusive of all other remedies at law as well as in admiralty; that at the time there were a large number of such suits pending against the United States or its agencies which, on the authority of the Johnson Case, were subsequently dismissed for lack of jurisdiction after the two-year period for instituting actions under the Suits in Admiralty Act had expired, leaving such claimants without a day in...