Sun Oil Co. v. Dalzell Towing Co.

• Decision Date: 11 January 1932
• Docket Number: No. 114.,114.
• Citation: 55 F.2d 63
• Parties: SUN OIL CO. v. DALZELL TOWING CO., Inc.
• Court: U.S. Court of Appeals — Second Circuit

55 F.2d 63 (1932)

SUN OIL CO. v. DALZELL TOWING CO., Inc.

No. 114.

Circuit Court of Appeals, Second Circuit.

January 11, 1932.

Duncan & Mount, of New York City (Frank A. Bull, of New York City, of counsel), for appellant.

Burlingham, Veeder, Fearey, Clark & Hupper, of New York City (Chauncey I. Clark and P. Fearson Shortridge, both of New York City, of counsel), for appellee.

Before L. HAND, SWAN, and AUGUSTUS N. HAND, Circuit Judges.

SWAN, Circuit Judge.

In May, 1925, the respondent was employed by the libelant to take its steamship Sabine Sun from Staten Island to Bergen Point, N. J. While proceeding through the Kill von Kull, accompanied by three of respondent's tugs, the captain of one of which was on the bridge of the steamer in the role of pilot and directing her helm and engine movements, the steamer grounded at a point which the District Court found to be outside the channel. To recover the damages thus sustained this suit was brought. The Sabine Sun was proceeding under her own steam, and the tugs were exonerated because none of them contributed in any way to the grounding. The appellant has assigned no error to the dismissal of the libel as to them. The respondent also was exonerated, on the ground that its contract of employment put the risk of the tug captain's alleged negligence (assuming that he was negligent) upon the tow. This ruling the appellant vigorously attacks. Two questions are presented: (1) Whether the contract did contain a provision putting the risk on the tow; and (2), if it did, whether such a provision is valid.

The contract was oral, and, as is usual in towage cases, consisted merely of an order telephoned by the tow owner and accepted by the tug owner, so that the full terms of the contract must be spelled out by the court from the previous dealings of the parties. On May 14, 1925, Mr. Turnbull, the assistant marine superintendent of Sun Oil Company, called the office of Dalzell Towing Company by telephone, and requested that on the following day they take the Sabine Sun from Stapleton to the dock of the Texas Oil Company at Bergen Point. The respondent's agent replied that they would be ready to take her about 1:30 p. m. That was all of the conversation. Nothing was said about pilotage, but Mr. Turnbull understood that his vessel would move under her own steam and that one of the tugboat captains would come upon her bridge and take charge as pilot. The parties had previously done business together, and on three prior occasions the respondent had mailed to the libelant a printed document entitled, "Pro Forma Towage Rates and Contract with Dalzell Towing Company," which contained a final paragraph reading as follows:

"Pilotage

"When the captain of any tug furnished to or engaged in the service of assisting a vessel which is making use of her own propelling power goes on board said vessel, or any other licensed pilot goes on board said vessel, it is understood and agreed that said tugboat captain or licensed pilot becomes the servant of the owners of the vessel assisted in respect to the giving of orders to any of the tugs furnished to or engaged in the assisting service and in respect to the handling of such vessel, and neither those furnishing the tugs and/or pilot nor the tugs, their owners, agents or charterers shall be liable for any damage resulting therefrom."

This had been sent to libelant's Philadelphia office on November 15, 1923, with a letter calling special attention to the pilotage clause. A second copy was sent to libelant's office at Marcus Hook, Pa., on December 28, 1923, and a third copy was again sent to that office on June 10, 1924. In letters accompanying the two copies last mentioned, reference was made by respondent to its schedule of towage rates, and it was asserted that bills which were being questioned by the libelant were in accordance therewith. The correspondence of June, 1924, was with Mr. Turnbull himself, who admitted that he had before him at the time a bill of respondent upon the face of which is printed the pilotage clause. Another bill bearing the same clause was also put in evidence, and Mr. Turnbull testified that he saw such bills "right along" and had "heard of" the pilotage clause, although he denied that he had ever actually read it until asked to do so at the trial. Whether he had actually read the clause and whether it was in his mind when he telephoned the order for tugs for the Sabine Sun is quite beside the point. The meeting of the minds of the parties to a contract is not determined by a subjective test. Mr. Turnbull's offer on behalf of the libelant, which the respondent accepted, must be interpreted in the sense in which the party using the words should reasonably apprehend that they would be understood by the other party. 2 Williston, Contracts, § 605. Knowing that the respondent had a schedule of rates and a pilotage clause, the importance of which had been stressed not only in the letter of November 15, 1923, but also by printing it on its billheads, the libelant should reasonably apprehend that its telephone order for tugs would be understood by respondent...