The Rupert City

• Court: U.S. District Court — Western District of Washington
• Citation: The Rupert City, 213 F. 263 (W.D. Wash. 1914)
• Decision Date: 14 April 1914
• Docket Number: 2487.
• Parties: THE RUPERT CITY.

213 F. 263

THE RUPERT CITY.

No. 2487.

United States District Court, W.D. Washington, Northern Division.

April 14, 1914

[Copyrighted Material Omitted]

George R. Biddle, of Seattle, Wash., for libelants.

Huffer & Hayden, of Tacoma, Wash., for claimant.

Herr Bayley & Wilson, of Seattle, Wash., for intervener Williams et al.

Albert Moodie, of Seattle, Wash., for intervener Wireless Telegraph Co.

Daniel Landon, of Seattle, Wash., for the crew.

NETERER District Judge.

On the 23d day of January, 1913, the Rupert City, owned and operated by a corporation of British Columbia, flying the British flag, sailed from Seattle bound for Australia. On May 28 1913, she arrived on her return voyage and anchored at Port Townsend. On the same day a libel was filed by Fischer Bros., monition issued, and the vessel taken into the custody of the United States marshal. Thereafter various intervening libels were filed by the members of the crew for wages, by the master for wages and advances, and by various parties claiming to have furnished supplies, repairs, or other necessaries. On the 19th day of June, 1913, Watts, Watts & Co. filed a petition in intervention alleging that it was the owner and holder of a certain mortgage executed to secure the payment of $19,000 advanced and other sums to become due, and prayed that it might appear and claim the vessel and defend against the various libels filed therein. Leave was accordingly granted by order of court on June 19, 1913. The cause was referred to the United States commissioner, who took the testimony and reported findings of fact and conclusions of law, and the cause is now before the court on exceptions to the report of the commissioner.

Interveners Watts, Watts & Co. claim priority of their mortgage over the various lien claimants. It is, however, well settled that a mortgage is not and cannot be made a maritime lien and that it is always subordinate to such liens. The J. E. Rumbell, 148 U.S. 1, 13 Sup.Ct. 498, 37 L.Ed. 345; Schuchardt v. Babbage, 19 How. 239, 15 L.Ed. 625; The Lyndhurst (D.C.) 48 F. 839. It is not even a maritime contract and may not be foreclosed in an action at rem. Bogart v. The John Jay, 17 How. 399, 15 L.Ed. 95; Rea v. The Eclipse, 135 U.S. 599, 608, 10 Sup.Ct. 873, 34 L.Ed. 269.

It does not follow, as contended, however, that the mortgagee may not intervene and defend against the establishment of maritime liens against the vessel. These would deplete the fund upon which he must rely, as the vessel when sold is discharged of his lien, and the mortgagee has a claim only upon the proceeds of the sale. Schuchardt v. Babbage, 19 How. 239, 15 L.Ed. 625; The H. N. Emilie (D.C.) 70 F. 511; The Advance (D.C.) 63 F. 704; The Old Concord, Fed. Cas. No. 10,482; The Mary Anne, Fed. Cas. No. 9,195.

When the vessel is sold and the fund is in the registry of the court, after the payment of all maritime claims, the court will order the payment of such nonmaritime liens as have been established, in the order of their priority. Claims not supported by liens cannot be paid out of the fund, since they are against the owners personally, and not against the fund. The Advance (D.C.) 63 F. 704, 706.

Libelants Fischer Bros. seek to establish not only a lien for supplies furnished by them, but also liens for supplies, repairs, and other necessaries furnished by various parties whose claims were assigned to the libelants by instruments in writing. It is stipulated that such claims were assigned for the purpose of 'collection' and that Fischer Bros. 'did not pay cash for them. ' Intervening mortgagee contends that a maritime lien is personal and that a maritime claim cannot be assigned so as to vest the lien in the assignee and entitle him to enforce it in his own name. But the great weight of authority is against such contention. 26 Cyc. 801, and cases there cited; The Sarah J. Weed, Fed. Cas. No. 12,350; The Emma L. Coyne, Fed. Cas. No. 4,466.

Exception is taken to the finding of the commissioner that the assignments were for value, and the contention is made that nothing having been paid, the assignor is the real party in interest and the assignee cannot maintain the action. But an assignment for collection in writing should be held to vest such an interest in the assignee as to entitle him to sue. The Court of Appeals of New York, in Hays v. Hathorn, 74 N.Y. 486, holds that an assignment for collection is an assignment for value, and that the assignee may sue, although the Code of that state provides that actions shall be brought in the name of the 'real party in interest.' To the same effect is the holding of the Supreme Court of Washington. McDaniel v. Pressler, 3 Wash. 636, 29 P. 209.

As the right of the various creditors to be paid out of the fund depends upon whether they have maritime liens, it may be well to call attention to the nature and character of maritime liens on ships and the circumstances which give rise to them. A maritime lien may be defined as a right of property in a ship adhering to it wherever it may go, vesting a right in the person whose claim is thereby secured to cause a sale of the ship in a proceeding directly against it in order to obtain satisfaction of his debt. It may arise from tort or contract. A contract to give rise to such a lien must be a maritime contract; that is, one which relates to the use of the ship as an instrument of commerce and navigation and one which tends to aid it in the accomplishment of its adventures as such. It is also necessary that the ship be pledged for the performance of such a contract before a lien will arise. Such pledging may be expressed in the agreement of the parties, or it may be implied from the circumstances under which they contracted that such was their intention, or the law may say from the nature of the contract and the circumstances under which it was made that a lien shall arise to secure its performance. The first question, therefore, to be determined, is whether the particular contract relied upon as creating the claim was a maritime contract, and, if so, did the parties expressly or impliedly contract that the credit of the ship might be relied upon for its enforcement, or was such an incident attached to the contract by the law?

The Fischer Claims.

The commissioner allowed Fischer Bros., as assignee, $627.25 for services performed in discharging the cargo at San Francisco. It is stipulated with respect to this claim that O. J. Humphrey, the managing owner of the Rupert City, was at San Francisco when the work was done, and that it was performed at his special instance and request. It is now settled that the labor of loading or discharging a cargo is a maritime service for which the credit of the ship may be so pledged as to give rise to an action in rem, since it is necessary to enable the ship to fulfill her maritime obligations. The Seguranca (D.C.) 58 F. 908; The Mattie May (D.C.) 45 F. 899; Florez v. The Scotia (D.C.) 35 F. 916; The George T. Kemp, Fed. Cas. No. 5,341, 2 Low. 477. It is stated that, where the stevedore is directly employed, his labor being similar to that which was formerly performed by seamen, he has a lien by the general maritime law, irrespective of whether or not the work was done in the home port of the vessel. But where the work of loading or discharging a cargo is done by a contractor who furnishes the labor of others, it is then stated that his claim is similar to that of one who furnishes workmen for repairs, and that, when done in the home port of the vessel, the presumption is that he intended to rely upon the credit of the owners.

The basic principle of a lien for necessaries is that the vessel must go on, and where its needs cannot be supplied from funds furnished by the owners or upon their personal credit the master is vested are furnished in the home port of the vessel, there is no presumption of necessity to pledge the credit of the ship, and this is also true where the contract is made with the owners or in their presence, even though the vessel may not be in the home port. 19 Am. & Eng.Encyc. of Law, 1102; The General Smith, 4 Wheat. 438, 4 L.Ed. 609; 19 Am. & Eng.Enc.of Law, 1098; 26 Cyc. 778; The Havana, 92 F. 1107, 35 C.C.A. 148. Quite generally the states enacted laws which provided for liens when the necessaries were furnished at the home port of the vessel, and the effect of these statutes is not to create a lien against the intention of the parties, but to create a presumption that such was their intention where nothing appears to the contrary. 26 Cyc. 777; The Westover (D.C.) 76 F. 381; The Golden Rod, 151 F. 8, 80 C.C.A. 248.

The Act of June 23, 1910, c. 373, 36 Stat. 604 (U.S. Comp. St. Supp. 1911, p. 1192), provides:

'Section 1. That any person furnishing repairs, supplies, or other necessaries, including the use of dry dock or marine railway, to a vessel, whether foreign or domestic, upon the order of the owner or owners of such vessel, or of a person by him or them authorized, shall have a maritime lien on the vessel which may be enforced by a proceeding in rem, and it shall not be necessary to allege or prove that credit was given to the vessel.

'Sec. 2. That the following persons shall be presumed to have authority from the owner or owners to procure repairs, supplies, and other necessaries for the vessel: The managing owner, ship's husband, master, or any person to whom the management of the vessel at the port of supply is intrusted.'

In Ely v. Murray, 200 F. 369, 118 C.C.A. 520, it was held that this statute met the presumption that necessaries furnished on the order of the owner were upon his personal credit, and thus that it is analogous to the state statutes the effect of which is to give rise to a presumption that the...