Britain S. S. Co. v. George E. Warren Corp.

22 F. Supp. 197, 1938 U.S. Dist. LEXIS 2384

• Court: District Court, D. Massachusetts
• Decided: January 31, 1938
• Docket: No. 667
• Status: Published

Opinions

McLELLAN, District Judge.

This libel involves the right to dispatch money for time saved in loading and discharging a ship. The libelant, a British corporation, is the sole owner of the British steamship Dartford. The respondent is a Massachusetts corporation having its usual place of business in Boston. •

By a charter party dated April 15, 1935, the libelant chartered the steamship to Amtorg Trading Corporation to carry a cargo of 6,000 tons (10 per cent, more or less in owner’s option) of coal from Mariupol, Nicolaieff, or Theodosia at charterer’s option, to “one or two ports northern range, U. S. A. * * * as ordered on signing bills of lading” for a freight of 10 shillings, 7% pence if loaded at Mariupol, or 10 shillings, 4% pence if loaded at Nicolaieff or Theodosia per ton of 2,240 pounds or 1,016 kilograms. Bills of lading, dated April 28, 1935, and signed by the master of the steamship Dartford, were issued at Mariupol, acknowledging the receipt from Amtorg Trading Cprporation of a specified amount of coal to be delivered at Boston to Amtorg Trading Corporation, “freight, all conditions and exceptions per unit delivered and charges, if any, as per margin, as per charter pa-rty dated 15 April 1935.” The cargo was consigned by the charterers to the respondent, which, under its contract with Amtorg Trading Corporation, was obligated to make settlement directly with said steamer, and any dispatch earned by the respondent at the discharging port was for its own account.

The pertinent portions of the charter party follow:

“5. Cargo to be loaded at the average rate of 600 tons per weather working day, Sundays, official and local holidays excepted whether used or not. * * *

“Time to commence at 1 P.M. if'notice of readiness to load is given before noon and at 6 A.M. next working day if notice given during office hours after noon.

“Saturdays and days preceding general or local holidays to count only as % of a day whether used or not.

“On Monday and the day after general or local holidays time -not to count until 8 A.M. whether used or not. * * *

“6. At U.S.A. ports steamer to be discharged at the average rate of 800 tons per weather working day, Sundays, official and local holidays excepted whether used or not, and cargo to be received by merchants from steamer’s hold free of expense to the steamer (free out).

“Time to commence at 1 P.M. if notice of readiness to discharge is given before noon and at 6 A.M. next working day if notice is given during office hours after noon.

“7. Ten running days on demurrage at the rate of 30 lbs. per day or pro rata for any part of a day payable day by day to be allowed merchants altogether at ports 'of 'loading and discharging. Detention over demurrage payable at 10% above the charter party' rate for demurrage. * * *

“17. Time allowed for loading and discharging as per clauses 5 and 6 to be reversible or to be settled at each end if required by charterers.

“18. Lay days not to commence before 25th April 1935 unless with charterer’s consent. * * *

“21. Owners to pay to charterers dispatch money at half demurrage rate for all time saved in loading and/or discharging.”

An agreed statement is on file and the facts are as stated therein.

The following facts, which appear either by admission in the pleadings or in the agreed statement, suffice to disclose the nature of the principal questions involved:

The charterer exercised its option to load at Mariupol, and also its option, found in clause 6 of the charter party, to load at not less than 1,000 tons per day. The Dartford arrived at Mariupol on April 24, 1935, and gave notice in writing before noon of the same day of readiness to load. Under the terms of the charter party, however, lay time did not begin until 6:00 a.m. on Thursday, April 25, 1935. The Dartford loaded 6,050 tons of coal and finished loading at 5:00 p.m. on Sunday, April 28, 1935. It is agreed that the vessel’s lay time under the charter party was 6 days and »ne hour; that her actual loading time was 3 days, 11 hours; and that the lay time used was 2 days and 12 hours.

The Dartford arrived at Boston on Saturday, May 25, 1935, and at 9:00 a.m. on Monday, May 27th, gave notice in writing of readiness to unload. The Dartford actually bega,n to discharge her cargo at 8:00 a.m. on Monday, May 27th, and under the terms of the charter party her lay time began at 1:00 p.m. on the same day, and was for a period of 7 days, 133/2 hours. The Dartford finished discharging at 8:0Q p.m. on Friday, May 31st.

. Upon the completion of the loading, the master signed without protest a time sheet showing 8 days and 8 hours time saved at the loading port. A copy of this sheet is annexed to the agreed statement of facts, and is referred to in greater detail below. The charterer did not exercise its option, found in clause 17 of the charter party, to require time allowed for loading and discharging to be settled at each end. It is agreed, therefore, that under the “reversible” provision of that clause, that to the lay time allowed for discharging, a certain amount of time must be added for time saved in loading. This amount is one of the questions in dispute between the parties. Upon completion of the discharge, the master, under protest, signed a time sheet showing a dispatch of 19 days, 14 hours, and 30 minutes, a copy of which is annexed to the agreed statement of facts. The respondent held back from the freight money which it was obligated to pay a sum for dispatch based upon this reckoning, and the owners of the vessel have brought this suit to recover the difference between the amount so held back and the amount which would have been payable for dispatch under their theory as to the proper construction of the charter.

It is further agreed, if it be material, that on Saturday afternoon some businesses are open, such as stores; some are closed, such as banks. Steamship offices are closed. Some unloading is done on Saturday afternoon in the port of Boston, but when it is done, overtime is paid.

The first question raised by these facts is whether, under clause 21, providing “owners to pay charterers dispatch money * * * for all time saved in loading and/or discharging,” the phrase “time saved” means lay days saved or time saved to the ship. The libelant contends that it means only the difference between the time allowed by the charter for loading or unloading and the amount of such time actually used. For example, if the charter provided for 5 lay days and 4 were used, the time saved amounts to one day, according to the libelant’s contention. The respondent, on the other hand, says that “time saved” means all time saved to the ship, or in other words, the difference between the date when the ship was actually ready to leave, and the date when the lay time would have expired had the charterers chosen to retain the vessel that long.

Since this charter party was entered into in England, the construction of its terms must be determined by the law of England. Gaston, Williams & Wigmore of Canada, Ltd., v. Warner, 260 U.S. 201, 43 S.Ct. 18, 67 L.Ed. 210; Yone Suzuki v. Central Argentine Railway, 2 Cir., 27 F.2d 795.

The parties have cited the following English cases bearing on the question: Laing v. Hollway, [1878] 3 Q.B.D. 437; The Glendevon, [1893] P.D. 269; Nelson Sons, Ltd., v. Nelson Lines Liverpool, [1907] 2 K.B. 705; In re Royal Mail Steam Packet Company v. River Plate Steamship Company, [1910] 1 K.B. 600; Mawson Steamship Company v. Beyer, [1914] 1 K.B. 304. These I treat as evidence upon which I am to find the English law as a fact.

In Laing v. Hollway, supra, a charter party provided: “Demurrage if any, at the rate of 20s. per hour, except in case of any hands striking work, frosts or floods, revolution or wars, which may hinder the loading or discharge of the vessel. Despatch money 10s. per hour on any time saved in loading and discharging.” Four days were saved in loading, and five in discharging. The plaintiff admitted that dispatch was payable for nine days, but contended that such dispatch was payable only at the rate of 10s. per hour for a working day of 12 hours. The defendant deducted dispatch figured on a basis of a 24-hour day, and the plaintiff brought suit for the difference. The court below decided in favor of the plaintiff; but its decision was reversed in the Court of Appeal. Bramwell, L.J., in delivering the opinion of the court, said of the meaning of the phrase “time saved”:

“Then, what is the meaning of ‘time saved in loading ’Or discharging ?’ The literal meaning we suppose would be doing those things in less time than they might be done in with ordinary despatch, i. e., if ordinary despatch with the number of hands and .ordinary diligence would load and unload in twenty days or 240 hours, then extraordinary despatch,- — extraordinary number of hands, and extraordinary diligence — in doing those things in fifte'en days or 180 hours, the difference five days, or sixty hours, is time saved. Because, strictly speaking, time is not saved in doing a thing by working twenty-four hours round instead of twelve in one day and twelve another; twenty-four have been consumed in each case. Time is saved by getting from A to B if a man runs in one hour instead of walking in two. But nobody suggests that this is the meaning. It is admitted on both sides, and is clear, that ‘time saved’ means if the ship is ready earlier than she would be if the charterers worked up to their maximum obligation only, all the time by which she is sooner ready is time saved within the meaning of the charter party.”

In The Glendevon, [1893] P.D. 269, a steamer was chartered to carry a cargo of coal from Newcastle to Lisbon. The charter party provided that: “The steamer to be discharged at the rate of two hundred tons per day weather permitting (Sundays and Fete Days excepted) according to the custom of the port of discharge and if sooner discharged to pay at the rate of 8s. 4d. per hour for every hour saved. * * * Demurrage twenty pounds for every day’s detention in discharging and in same proportion for any part of such day over and above the days allowed as fore-said except in case of riot or any hands striking work frost snow or floods or other accidents which may prevent the discharging of such steamer.” The question presented was whether a Sunday and a Fete Day occuring during the lay period should be included in calculating dispatch. The court here held that they should not be included, and that dispatch was payable only for working days saved.

In Nelson Sons, Ltd., v. Nelson Lines Liverpool, [1907] 2 K.B. 705, the cause of action arose out of an agreement in the nature of a charter party under which the steamers of the defendant line were to carry cargos of frozen meat from the River Plate to England. The agreement provided: “Seven weather working days (Sundays and holidays excepted) to be allowed by owners to charters for loading. * * * For any time beyond the periods above provided the charterers shall pay to the owners demurrage at the rate of 40£ per day, and so in proportion for any part of a day, payable day by day. For each clear day saved in loading the charterers shall be paid or allowed by the owners the sum of 20£.” In the course of arbitration proceedings under this agreement, a dispute arose as to whether dispatch was payable for subsequent Sundays or holidays falling within the lay period as time saved. The arbitrator, on the authority of The Glendevon, supra, held that for the purposes of dispatch money the charterers could only “save” days on which they could require the ship to work, and not for Sundays or holidays. This decision was affirmed by the Divisional Court, and was then heard by the Court of Appeal, which reached the same conclusion by a majority of two to one. Buckley, L.J., speaking for the majority, said:

“By finishing their loading on the Saturday the charterers saved the shipowners delay, but there was no day saved in loading so far as Sunday was concerned. The relevant words are ‘seven days to be allowed for loading,’ and ‘for each clear day saved in loading’ the charterers shall be paid. In this language no trace is to be found of saving delay to the ship. The payment is to be made for any saving effected in the seven days allowed for loading. This conclusion is in accordance with the decision in The Glendevon, which in my opinion, was rightly decided.”