THE FALCON

• Court: U.S. District Court — District of Maryland
• Writing for the Court: SOPER
• Citation: THE FALCON, 19 F.2d 1009 (D. Md. 1927)
• Decision Date: 06 June 1927
• Docket Number: No. 1263.,1263.
• Parties: THE FALCON. THE POWHATTAN.

19 F.2d 1009 (1927)

THE FALCON.

THE POWHATTAN.

No. 1263.

District Court, D. Maryland.

June 6, 1927.

Amos W. W. Woodcock, U. S. Atty., of Baltimore, Md., for the United States.

Marbury, Gosnell & Williams, of Baltimore, Md., for claimant of the Powhattan.

SOPER, District Judge.

The United States, as owner of the steamship Massillion Bridge, has brought a libel in rem against the steam tugs Powhattan and Falcon, claiming substantial damages occasioned by the grounding of the ship in the Baltimore harbor on June 8, 1920, alleged to have been caused by the negligent operation of the tugs while in control of the ship. The libel was filed in this court on April 28, 1924. The Cottman Company, as owner and claimant of the Powhattan, has filed an answer, denying responsibility on the part of the Powhattan for the accident, and further answering that at the time of the accident the tugs were owned by the Maryland Transportation Company, from which, on March 30, 1922, the Cottman Company purchased the Powhattan; that the Maryland Transportation Company was shortly thereafter liquidated and dissolved; that at the time of the purchase the claimant did not assume the liabilities of the Maryland Transportation Company, and had no knowledge of any claim on the part of the United States against the tug, and did not acquire such knowledge until October 1, 1923. The Cottman Company therefore claims that it has been greatly prejudiced by the long delay of the United States in bringing suit, and that its claim is stale and barred by laches. The United States excepts to so much of the answer as alleges that its claim is barred by laches, contending that laches may not be availed of as a defense against the government.

The principle that the United States is not bound by any statute of limitations, nor barred by laches of its officers, however gross, in a suit brought by it as a sovereign government to enforce a public right or to assert a public interest, is established beyond all doubt. It is only when the United States is merely a formal party to a suit, and the remedy sought in its name is the enforcement of a right for the benefit of a private party, that the immunity of the United States from the defense of limitations or laches is barred. United States v. Beebe, 127 U. S. 338, 8 S. Ct. 1083, 32 L. Ed. 121. The United States asserts that, although in the case at bar it is seeking compensation for damages to its merchant vessel operated in the carrying trade, it is nevertheless suing in its sovereign capacity to enforce a public right. It calls attention to the Shipping Act of September 7, 1916 (39 Stat. 728 Comp. St. § 8146a et seq.), declared by its title to be an act to establish a United States Shipping Board, for the purpose of encouraging, developing, and creating a naval auxiliary and naval reserve, and a merchant marine to meet the requirements of the commerce of the United States, etc. (The Lake Monroe, 250 U. S. 246, 250, 39 S. Ct. 460, 63 L. Ed. 962; Eastern Transportation Co. v. United States, 272 U. S. 675, 688, 47 S. Ct. 289, 71 L. Ed. ___), and to section 1 of the Merchant Marine Act of June 5, 1920 (41 Stat. 988 Comp. St. § 8146¼) wherein it is said that it is necessary for the national defense, and for the proper growth of its foreign and domestic commerce, that the United States shall have a merchant marine of the best-equipped and most suitable type of vessels, sufficient to carry the greater portion of its commerce, and serve as a naval or military auxiliary in the time of war or national emergency. There is indeed authority for the proposition that when for the purpose of advancing the trade of its people, or providing revenue for its treasury, a government acquires, mans, and operates ships in a carrying trade, they are public ships in the same sense that war ships are, and that the maintenance and advancement of the economic welfare of a people in time of peace is no less a public purpose than the maintenance and training of a naval force. Berizzi Bros. v. The Pesaro, 271 U. S. 562, 574, 46 S. Ct. 611, 70 L. Ed. 1088; U. S. v. Porto Rico Fruit Union (C. C. A.) 12 F.(2d) 961. Speaking generally, the Supreme Court has also said that the United States does not and cannot hold property as a monarch may for private or personal purposes, but all of its property is held and applied "to pay the debts and provide for the common defense and general welfare of the United States." Const. art. 1, § 8, cl. 1; Van Brocklin v. Tennessee, 117 U. S. 151, 158, 6 S. Ct. 670, 29 L. Ed. 845. Compare South Carolina v. United States, 199 U. S. 437, 26 S. Ct. 110, 50 L. Ed. 261, 4 Ann. Cas. 737; Los Angeles v. Los Angeles Gas Corp., 251 U. S. 32, 40 S. Ct. 76, 64 L. Ed. 121.

It is contended, however, by the claimant that the laws enacted by Congress for the operation of the nation's merchant marine indicate an intention that the United States, having entered upon the marine carrying trade in competition with private citizens, shall stand therein on the same footing with them. The acts of Congress especially referred to are section 9 of the Shipping Act, supra (Comp. St. § 8146e), and sections 1, 2, and 3 of the Suits in Admiralty Act of March 9, 1920 (41 Stat. 525 Comp. St. §§ 1251¼, 1251¼a, 1251¼b). They provide particularly for the revocation of the rule that the United States may not be sued, and its property may not be seized, at the instance of a private citizen. Recognizing that claims against government ships would necessarily arise in the transaction of the shipping business, Congress provided by said section 9 that such vessels, while employed under charter solely as merchant vessels, should be subject to all laws, regulations, and liabilities governing merchant vessels, whether the United States were interested therein as owner, in whole or in part, or held any other interest therein. It was held in The Lake Monroe, supra, that under this section, as modified by subsequent legislation, the federal courts had jurisdiction to arrest a government-owned vessel when libeled for damages arising from collision.

Sections 1 and 2 of the Suits in Admiralty Act provide that no vessel owned by the United States shall be subject to arrest or seizure by judicial process in the United States; but in cases where, if such vessel were privately owned, a proceeding in admiralty could be maintained against her, a libel in personam may be brought against the United States, provided the vessel is employed as a merchant vessel. Section 3 provides that such suits shall proceed and shall be heard and determined according to the principles of law and to the rules of practice obtaining in like cases between private parties. The effect of this act is merely to substitute a right of action in personam against the United States for the action in rem against the vessel, so as to obviate the inconvenience to the government from the seizure of its ships. Blamberg Bros. v. U. S., 260 U. S. 45a, 43 S. Ct. 179, 67 L. Ed. 346; U. S. v. Neptune Line (C. C. A.) 12 F.(2d) 568; Eastern Transportation Co. v. United States, supra.

It is noteworthy that, while it is provided that government vessels shall be subject to all laws, regulations, and liabilities governing merchant vessels, and suits may be brought against the United States for the liabilities of its ships, and tried according to the law and practice in like cases between private parties, no express provision is made for suits by the United States or the procedure by which its rights may be enforced. Now it is well settled that the extraordinary immunity granted to the United States from the defense of limitations and laches shall not be lost, except by act of Congress clearly manifesting such purpose; and this principle has been accepted as requiring, not a liberal, but a strict, construction of a statute when it is urged as a bar to the rights of the government. U. S. v. Whited & Wheless, 246 U. S. 552, 561, 38 S. Ct. 367, 62 L. Ed. 879; Dupont v. Davis, 264 U. S. 456, 462, 44 S. Ct. 364, 68 L. Ed. 788.

It may be assumed, therefore, for the purposes of this suit, that the United States is proceeding in its public character, and the defense of laches is no more available here than in any other government suit. Whether such a defense would be available to a libelant against a cross-libel of the United States, in view of the provisions of section 3 of the Suits in Admiralty Act, need not be decided. It does not, however, necessarily follow that the exceptions to the answer should be sustained. The proposition for which the United States contends has been broadly stated in a score of cases¹ cited by counsel, from U. S. v. Kirkpatrick, 9 Wheat. 720, 735, 6 L. Ed. 199, to Utah Power & Light Co. v. United States, 243 U. S. 389, 409, 37 S. Ct. 387, 61 L. Ed. 791, but in none of them does the actual decision cover facts equivalent to those in this suit.

In the Kirkpatrick Case it was said:

"The general principle is that laches is not imputable to the government; and this maxim is founded not in the motion of extraordinary prerogative, but upon a great public policy. The government can conduct its business only through its agents, and its fiscal operations are so various, and its agencies so numerous and scattered, that the utmost vigilance would not save the public from the most serious losses, if the doctrine of laches can be applied to its transactions."

In the last case it was said that, as a general rule, laches or neglect of duty on the part of the officers of the government is no defense to a suit by it to enforce a public right or protect a public interest, seemingly suggesting that the rule is not universally applicable. It was decided a number of times in the cases cited that the surety on the bond of a public officer will not be relieved merely because of the failure on the part of officers of the government to carry out statutory provisions requiring report or accounts from the...