United States v. Certain Subfreights Due Steamship Neponset

• Decision Date: 01 May 1924
• Docket Number: 2277,2314,2228,2407.
• Citation: 300 F. 981
• Parties: UNITED STATES v. CERTAIN SUBFREIGHTS DUE STEAMSHIP NEPONSET.
• Court: U.S. District Court — District of Massachusetts

300 F. 981

UNITED STATES v. CERTAIN SUBFREIGHTS DUE STEAMSHIP NEPONSET.

Nos. 2228, 2277, 2314, 2407.

United States District Court, D. Massachusetts.

May 1, 1924

On Reargument, July 18, 1924.

On Reargument.

In No 2228:

The United States Attorney.

Blodgett Jones, Burnham & Bingham, of Boston, Mass., for petitioner Willett.

G Philip Wardner, of Boston, Mass., for interveners Wambersie & Son.

Charles R. Hickox and Kirlin, Woolsey, Campbell, Hickox & Keating, all of New York City, and Blodgett, Jones, Burnham & Bingham, of Boston, Mass., for intervening petitioners Standard Oil Co., McCormack, Stevedoring Co., and Traeger.

Fitz-Henry Smith, Jr., of Boston, Mass., and Bigham, Englar & Jones, of New York City, for intervening petitioner Buck.

Charles F. Dutch, of Boston, Mass., for intervening petitioner Robbins Dry Dock & Repair Co.

In No. 2277:

Charles R. Hickox and Kirlin, Woolsey, Campbell, Hickox & Keating, all of New York City, and Blodgett, Jones, Burnham & Bingham, of Boston, Mass., for libelant Standard Oil Co.

G. Philip Wardner, of Boston, Mass., for interveners Wambersie & Son.

The United States Attorney.

In No. 2314:

Charles R. Hickox and Kirlin, Woolsey, Campbell, Hickox & Keating, all of New York City, and Blodgett, Jones, Burnham & Bingham, of Boston, Mass., for libelant McCormack Stevedoring Co.

The United States Attorney.

In No. 2407:

Chas. F. Dutch and Putnam, Bell, Dutch & Santry, all of Boston, Mass., for libelant Robbins Dry Dock & Repair Co.

The United States Attorney.

LOWELL District Judge.

These legal proceedings arose out of the last voyage of the steamer Neponset while under the control of the Elder Steel Steamship Company. The Neponset was registered in Philadelphia. The United States took possession of the Neponset by means of a libel brought to get possession of the vessel, which had been operated by the steamship company under an agreement with the United States Shipping Board. After taking possession the United States expended $12,947.63 in discharging the cargo; the freight money which is the subject of this case was thereby earned, and has been deposited in this court. By agreement of parties a claim of the master was allowed and there remains in the registry the sum of $23,077.03. The claim of Leonard Buck, hereinafter referred to, is in excess of this amount. The total sum of the demands of the other claimants may be met without exhausting the fund.

The facts can more conveniently be stated in chronological order, with the exception of those relating to Wambersie & Son and Buck, which will be mentioned later. The Neponset was about to start on a voyage to the Pacific Coast. She needed some repairs, which were furnished by the Robbins Dry Dock Company, and she then proceeded on her voyage. On the return trip she was furnished with oil by the Standard Oil Company at San Pedro, Cal., and Cristobal, Canal Zone. When she arrived in New York, part of her cargo was unloaded by the McCormack Stevedoring Company, and services in relation thereto were furnished by Traeger. She then went to Boston, where she was libeled by the United States government. In unloading at Boston, an expense of $12,947.63 was incurred, which was paid by the United States.

The United States, after taking possession of the Neponset, filed a libel against the freight moneys, and the Robbins Company, Standard Oil Company, McCormack Company, and Traeger filed intervening petitions. Wambersie & Son and Buck also filed intervening petitions. The former, acting as general agent of the steamship company on the continent of Europe, had made advances to the Neponset on a former voyage. Buck claimed as the holder of an assignment of the freights of certain steamers, which he alleged covered freights of the Neponset. The original assignment was given by the steamship company to secure advances made to it to discharge liens on steamers other than the Neponset before she started on her last voyage. The Robbins Company, Standard Oil Company, and McCormack Company also filed independent libels, claiming liens on the vessel for the repairs, supplies, or services furnished her under the circumstances above set forth. In the case of the Standard Oil Company, Wambersie & Son filed an intervening petition.

In the libel against the freight, the United States based its right to recover on a clause in the charter party under which the Neponset was first operated. At the first hearing of this case the intervening petitioners contended that the charter party had been superseded by a sales agreement which contained no clause giving a lien on freights. The United States then asked leave of court to amend its libel, so as to claim $12,947.63 for the expense of unloading the cargo after it took possession, and in the alternative the freight money earned, on the ground that the United States was entitled thereto as the owner of the vessel. The allowance of this amendment was strongly opposed, and the court took it under advisement. I now allow the latter part of it, as the facts upon which it was predicated were fully developed at the hearing. I disallow the first part, because it is inconsistent with the part allowed. If the United States is entitled to claim the freight as owner, it cannot be reimbursed for the expenses made necessary in earning the freight. A further pleading was filed by the United States on January 19, 1924, after the hearing, argument, and reargument. This pleading is entitled a 'Claim and Petition.' It sets up in a different form the same matter contained in the amendment, and is disallowed, as it adds nothing further to the claim of the United States.

A petition by the receivers of the Elder Steel Steamship Company for leave to intervene was filed after the hearing and arguments. As will appear hereafter, no part of the freight money belongs to the company, and its receivers are not, therefore, entitled to it. The petition is denied.

It will conduce to clearness if we first consider the independent libels of the Robbins Dry Dock Company, Standard Oil Company, and McCormack Company. The questions involved in all three are similar, and will be considered together. The libelants contend that the steamship company was operating the Neponset as owner, and that they furnished the repairs, supplies, and services on the order of the owner, and are entitled to liens. The United States says that the Neponset was being operated under a charter party, which gave the charterer no right to allow liens to be imposed on the vessel. The libelants meet this contention by insisting that the charter party which was in force at first had been superseded by another agreement. The facts are as follows:

The Neponset was delivered to the Elder Steel Steamship Company on May 13, 1920, under a charter party to last for 18 months, which contained a clause forbidding liens. Afterwards negotiations took place, in the course of which the Shipping Board on October 20, 1920, wrote to the company, saying that they had changed from the charter purchase plan of April 8, 1920, to the new sale policy of August 16, 1920, one of the terms of which was that 10 per cent. of the purchase price of the vessel was to be paid before its delivery. On November 24, 1920, the attorney of the Shipping Board sent to the company an agreement for sale, with an accompanying letter which reads in part as follows:

'I transmit herewith original and duplicate of agreement of sale on the steamship Neponset, with the request that you kindly execute the original thereof on page 12 and the acknowledgment on page 14 and return same to this office at the earliest possible date. You will note that it is provided in this agreement that you are to pay, upon execution, the sum of $45,902.31, which, together with the sum of $144,934.11 previously paid by you, totals $190,736.42, which is the ten (10) per cent. initial payment on the vessel.'

The new agreement was in part as follows:

'Whereas, the seller has sold to the buyer and the buyer has purchased from the seller that certain steel vessel named the Neponset, official number 217019, registered at the port of New York, of about 7,435 tons gross and 4,565 tons net register, now being operated by the buyer under the terms of a charter sales agreement between the parties hereto, dated April 10, 1920; and

'Whereas, the said vessel was delivered to the buyer on May 13, 1920; and

'Whereas, the purchase price of said vessel is the sum of $1,907,364.25; and

'Whereas, the buyer has paid to the seller under the terms of said charter sales agreement the sum of $144,934.11, and agrees to pay in addition thereto, upon execution of this agreement, the sum of $45,802.31, which sums total $190,736.42, which is ten (10) per centum of the said purchase price; and

'Whereas, the buyer has requested that the seller modify the said charter sales agreement to conform to the terms of the purchase plan now in use by the seller; and

'Whereas, the seller is willing to modify the said charter sales agreement;

'Now, therefore, for and in consideration of the premises and the mutual covenants hereinafter contained, it is agreed by the seller and the buyer as follows:

'(1) The buyer may retain said vessel for operation hereunder. * * *

'(5) (d) The buyer shall not suffer to be continued any lien or charge having priority to or preference over the title of the seller in the vessel, or any part thereof, but will in due course and in any event, within fifteen (15) days after the same becomes due and payable, pay or cause to be discharged or make adequate provision for the satisfaction or discharge of all lawful claims or demands which might in equity, in admiralty, or at law, or pursuant to

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