The J.W. Tucker

• Decision Date: 24 April 1884
• Citation: 20 F. 129
• Parties: THE J. W. TUCKER.
• Court: U.S. District Court — Southern District of New York

20 F. 129

THE J. W. TUCKER.

United States District Court, S.D. New York.

April 24, 1884

Benedict Taft & Benedict, for Stillman.

Jas. K Hill, Wing & Shoudy, for Dentz.

BROWN J.

The claim of the libelant Stillman presents in its simplest form the question whether, as between maritime liens of the same rank, priority is to be given to that on which the libel is first filed and the vessel first arrested, without regard to the dates at which the lines respectively accrued. Such was the rule declared in this district in the case of The Triumph, (1841,) 2 Blatchf. 433, note, and The Globe Id. 433, (1852,) and which has been more or less followed since. The principle on which this rule was based in the language of those cases, is that a maritime lien 'is, in realty, only a privilege to arrest the vessel for a debt which, of itself, constitutes no incumbrance on the vessel, and becomes such only by virtue of an actual attachment. ' Upon this view of the nature of a maritime lien, it is obvious that the parties first attaching the vessel must necessarily have a prior right. But this view of the nature of maritime liens, which is the foundation of the rule in question, has long since been superseded. In the case of The Young Mechanic, 3 Ware, 85, WARE, J., defines it as 'a jus in re, a proprietory interest in the thing, which may be enforced directly against the thing itself by a libel in rem, in whosesoever possession it may be, and to whomsoever the general title may be transferred. ' The subject was elaborately considered by CURTIS, J., on appeal in the same case, 2 Curt. 404. The definition of maritime liens, as stated by WARE, J., was affirmed, and the view of the nature of such liens, as expressed in the case of The Triumph, was shown to be unsound, (page 412.) The same view was affirmed in the following year (1856) by the supreme court, in the case of The Yankee Blade, 19 How. 82, 89, and has since then been universally recognized and followed. In the case of The Lottawanna the supreme court say, (21 Wall. 579:) 'A lien is a right of property, and not a mere matter of procedure. ' WARE, J., in the case of The Paragon, 1 Ware, 322, 330, held, according to this view of such liens, that 'when all the debts hold the same rank of privilege, if the property is not sufficient to fully pay all, the rule is that creditors shall be paid concurrently, each in proportion to the amount of his demand. ' LOWELL, J., in the case of The Fanny, 2 Low. 508, says: 'The general rule in admiralty is that all lienholders of like degree share pro rata in the proceeds of the res, without regard to the date of their libels or suits, if all are pending together. ' The same view was taken by Judge HALL, in the case of The America, 16 Law Rep. 264, 271. So, in the cases of The Superior, 1 Newb. 176; The Kate Hinchman, 6 Biss. 367; The General Burnside, 3 F. 228, 236; The Arcturus, 18 F. 743; The Desdemona, 1 Swabey, 158, it was held that concurrent lines of the same rank should be paid pro rata, where the proceeds were insufficient to pay all, without regard to the date of the libel or the attachment of the vessel by either. Roscoe, Adm. 101. Such is the provision, also, of the French law. Code de Com. 191.

The precise question here presented has not, so far as I can ascertain, arisen of late years within this district. In the Eastern district, in the case of The Samuel J. Christian, 16 F. 796, the question seems to have been regarded by BENEDICT, J., as an open one. He there held that a lien for damages by collision was subject to the prior claims of material-men, and did not acquire any priority over the latter through the prior filing of the libel; and he concludes his opinion by saying that 'it is unnecessary to consider the question whether, as between claims of equal rank, a prior seizure of the vessel secures priority in the distribution of the proceeds.'

The recent decision in the circuit court in this district, however, in the case of The Frank G. Fowler, 17 F. 653, accords in principle with the several cases recently decided, to which I have above referred, holding that mere priority of attachment does not entitle to a preference. That decision seems to me plainly incompatible with the rule adopted in the cases of The Triumph and The Globe, supra, and with the views upon which that rule was founded. In the case of The Fowler, damages in favor of different lienors had accrued by two collisions upon successive voyages of the same vessel. The libel for the last collision was filed three days before the libel for the previous collision; but the attachment of the vessel by the marshal was made upon both processes at the same time. The proceeds of sale being insufficient to pay both claims, this court held, for reasons which need not be here referred to, that the liens should be paid in the inverse order of the time at which they accrued. 8 F. 331. On appeal, BLATCHFORD, J., reversed this ruling, and held that the earlier damage should first be paid in full. Had the rule of priority depended upon the time of filing the libel, the judgment of the district court should have been affirmed, since the libel on the last lien was first filed; had priority depended upon the time of the arrest of the vessel alone, then, as the arrest upon both libels was at the same time, and the claims were of the same rank, neither had priority of the other, and the proceeds should have been divided pro rata between them. Neither of these courses was pursued. The decision, on the contrary, in awarding priority to the earlier lien, established for this circuit the principle, which has been repeatedly affirmed elsewhere, that a lien is a vested proprietary interest in the res itself, from the time when it accrues; and also that failure to enforce such a lien by immediate suit, before the vessel proceeds on another voyage, is neither laches nor sufficient, by any equity or rule of policy, to displace its priority, as a vested proprietary interest, over a subsequent lien of the same rank upon which the vessel is arrested at the same time. The former rule in this district, which made priority among liens of the same rank depend upon the date of filing the libel, or the arrest of the vessel in the proceeding to enforce it, must be regarded, therefore, as superseded; not merely because the foundation upon which that rule rested has been wholly swept away, but also because the rule adopted by the circuit court in the case of The Frank G. Fowler is incompatible with its longer existence.

Viewing maritime liens, therefore, as a proprietary interest in the vessel itself, and the filing of the libel and seizure of the vessel as proceedings merely to enforce a right already vested, it follows, necessarily, that, as between different lienors, any proceeds in the registry should be distributed according to the rightful priorities of the liens themselves, and not according to priority of the proceedings merely to enforce them. This rule permits all the equities of such liens to be considered and enforced, instead of subordinating these equities to a mere race of diligence.

Where the liens are of the same rank, there is often an equitable priority among them arising out of the character of the liens themselves, or the time when they accrued. A later lien for salvage is entitled to priority over a former salvage because the last service has preserved the benefit of the former. The same is true of successive repairs of a vessel on different voyages, or on different parts of the same voyage, or liens on successive bottomry bonds. The later improvements or advances are for the preservation of the former, or for further improvements upon the vessel; and they have, therefore, an equitable priority. As regards such liens, therefore, the rule is that they shall be discharged in the inverse order of their dates. 3 Kent, 197; The Eliza, 3 Hagg. 87; The Rhadamanthe, 1 Dods. 201; The Bold Buccleugh, 7 Moore, P.C. 267; The St. Lawrence, 5 Prob.Div. 250; The Fanny, 2 Low. 508; The Jerusalem, 2 Gall. 345; The America, 16 Law ...