Crow v. Myers

41 F. 806, 1890 U.S. Dist. LEXIS 112

• Court: District Court, E.D. Virginia
• Decided: February 19, 1890
• Status: Published

Opinion

Hughes, J.,

(after stating the facts as above.) The foregoing statement embraces the controlling facts of the case under consideration, drawn from a great mass of evidence on file. The question of the case is whether the libelants, stricti juris, had on the 24th December, 1888, complied with the requirements of the charter-party, as to readiness to receive cargo, and whether the respondents had a technical right to cancel that instrument. I say stricti juris, because, although courts of admiralty, as courts of equity, are in general reluctant to enforce forfeitures, or to justify recourse to rights merely technical, yet it is proper, and they are ready to do so, where the very right of the case is subserved' by such action, and where the facts do not fall within the reason of the maxim, ut res magis valeat quam pereat. In the case at bar, although the libelant lost by cancellation the benefit of the first charter-party, yet his ship, after a few days, was rechartered by the libelants, and made a prosperous voyage to her home port. The profit from the second charter-party was probably not as great as would have been derived from the first, but the difference was only pecuniary. The ship did not have to go home in ballast, and no serious loss or grievous disaster occurred to the libelant. The case was one of greater hardship to the respondents, attended by more or less loss and mortification in business, resulting from disappointment from the unexpectedly tardy movement and late arrival of the ship. The ship passed Gibraltar more than 24 hours later than was expected. Her voyage thence to New York was as much as a day longer than was expected, and she consumed five days more in discharging in New York than either her master or her New York consignees expressly indicated that she would consume. So that, instead of arriving in Hampton Roads by the 12th December, in time to load before the Christmas holidays, she did not arrive until the 21st, and then was not in condition to give notice of readiness to load until the 24th December, the eve of Christmas. The proof is that rates of freight do, and did then, take a serious fall at Christmas; and even a small decline in rates makes all the difference between profit and loss on charter-party contracts in which, as in the ports of Hampton Roads, the margins of profit are very small. If, therefore, the very right of the case in this controversy seems to justify a strict and technical construction of the charter-party, there is nothing in the policy of admiralty or equity courts to forbid the application of it.

That the margin of profit to the charterers was very small under the first charter-party is shown by some of the facts exhibited in the evidence. The ship was chartered for the lump sum of £4,500, or about $22,000. It was chartered primarily for cotton, in the midst of the cotton exporting season, when that article pays a higher freight to the charterer than any other article of export. The charter-party provides for a full and complete cargo of cotton or other merchandise, at the discretion of the charterers; so that, if a full and complete carge of cotton could be put on the steamer, it was to be presumed that the cargo would in fact be, as nearly as practicable, all cotton. The capacity of this ship for cargo, as shown by the plan of her furnished to the charterers, including the main between-decks cross-bunkers, was 204,200 cubic feet. If every foot of these cargo spaces were of such form and dimensions as to admit of being filled with cotton, the charterers might have put on board 9,281 bales, allowing 22 cubic feet as the dimensions of the compressed bale. From the spaces thus computed must, however, be deducted the displacement necessary to making room for 100 tons of ballast, equivalent in dimensions to 181 bales of cotton. This gives 9,100 bales as the utmost number stowable in all the spaces of this ship marked as for cargo on the plan that has been mentioned. But, the form of cotton bales being fixed and unchangeable, there is more or less waste of space in stowing them on board; this waste being sometimes very considerable. I judge that in the seven different compartments of the Cambodia, three of them comparatively small, the loss of stowing capacity for cotton bales, on the whole ship, would hardly be less than for 350 bales, and that the most skillful stevedore could hardly store more than 8,750 bales in the spaces marked for cargo on the plan of the ship. The proofs in this case show that $2.50 per bale represents the average freight on cotton from Norfolk to Liverpool. Therefore, if Myer, & Co. could have used all the spaces marked for cargo on the Cambodias they would have received on the shipment, at the average of $2.50 per bale for 8,750 bales, the sum of $21,875, and would, have realized from their contract about the price, which they stipulated to pay for the ship. When, therefore, on the 24th December, Mr. Slaughter found that the main between-decks cross-bunkers of the Cambodia were not cleared for cargo, and learned that the master positively' insisted upon using that space for coal, it was not surprising that his firm finally determined to cancel the charter-party'.. This space was of capacity for stowing 196 bales of cotton, representing $485 of freight money, which sum is hardly more than the margin of profit on which large ships are chartered in the cotton season, in this port, for Liverpool. If the Cambodia had arrived by the 12th December, and the occurrences from the period from December 21st to 24th had happened in the few days following the 12th, the hardship upon. Myers & Co., of depriving them of the disputed cross-bunkers, would have not been so great, because, in the comparative buoyancy of freight rates, they might have found some way' of compensating themselves for the loss of so much cargo space. Arriving, however, as the ship did, at a period of depression in freight,rates, after unexpected delays, it was not unreasonable in Myers & Co. to expect the master >to do as the evidence shows that-he had done on previous voyages, and, by putting 100 tons of coal on deck, yielded the space in dispute to the charterers for Cotton. The master, however, does not seem to have been of a temper to yield his own view's .to such considerations of- deference to the interest of his charterers. Being of opinion, from what has beep.said, that the equities of the case at bar-were on the side of the respondents, I feel at liberty to place a technical construction upon several provisions of the charter-party' under consideration.

■ And first as to the clause defining the space for cargo which should be at the charterers? disposal: On this head the only question is whether the charterers. were entitled to the main between-decks cross-bunkers marked as for cargo, with capacity of 4,268 cubic feet, upon the plan of the ship. .This plan -or paper is not part of the charter-party', and cannot be taken,to.affect or modify its provisions. It is merely a reprer sentation of the ship and its several parts. Its only value is to enable us to understand more clearly than we could do without it the provision of-the-charter-party, defining the spaces to be used by charterers. This ipstruinfnt, gave the. charterers a.right^o “the entire carrying capacity of the vessel, including cross-bunkers * * * and other spaces where steamer has usually carried cargo, or would carry cargo if loaded on rates,” exclusive of space needed for coal, etc., the owners guarantying “not to occupy more space for coals below decks than was occupied on previous voyages from the United States to Europe when loaded with cotton for [owners’] benefit.” The last clause of this provision, though showing the intention of the parties, was not specifically applicable to the Cambodia, which had made no such voyage with cotton. But it is proved, that the Cambodia had crossed the Atlantic in voyages on which she had started out with 100 tons of coal on deck. It is proved that she made a voyage under the second chartering, in January following the cancellation of the first contract, from Norfolk to Liverpool, with 489 tons of coal taken on here, and had 68 tons left on her arrival at Liverpool, having consumed 421 tons. The plan of the ship shows that her bunkers below deck, marked for coal, carry 374 tons. Certainly, therefore, with these coal bunkers filled, and 100 tons more on deck, making 474, only 7 tons less than she took on at Norfolk under the second chartering, the main between-decks cross-bunkers, which her master refused for cotton, were not “needed” for coal. So that the question simply is whether the contract, in its spirit and intention, and its use of the term “needed,” justified Capt. Wildgoose in insisting upon putting coal in the disputed cross-bunkers to an amount which he had before, on occasions, carried on deck. I think it did not justify him, and that the charterers were entitled to the main between-decks cross-bunkers.

As to the provision relating to ballast: The charter-party gave the charterers an option to ship grain or heavy cargo, at their discretion, and provided that if heavy cargo was not shipped, and ballast should be required, the ballast should be provided by the steamer. There is no provision of the contract which requires the charterers to notify the master, in advance of loading, of the particular kinds and quantities of cargo they would put on board. This matter is governed by the custom of the port; and according to this custom, and independently of custom, the option of the charterers as to how the cargo should be made up continues during the whole period of loading, which, if this ship had been loaded, might have lasted 17 days, exclusive of Sundays. The fact that this continuing option existed made it incumbent upon the master to have ballast on hoard at the time he gave notice of readiness to receive cargo, or readily at hand to be taken on board, if the charterer yrould so require, before loading was completed. In point of fact, the Cambodia brought no ballast from New York; and her master admits, in evidence, that he could not procure it in Newport News, or anywhere short of Baltimore. The ship, therefore, if she had been loaded by the charterers without dead-weight cargo, as they had a right to do, would not have been in condition to comply with her, stipulation in the charter-party to proceed direct to Liverpool on being loaded. Capt. Wildgoose sought to excuse his neglect in providing ballast by contending that the telegram of 6th December, received from Myers & Co. while he was in New York, asking whether he required dead-weight cargo to load cotton, was a notification to him that the charterers would supply dead-weight cargo. This is an untenable position. If mere inquiries for information were equivalent to stipulations, all commercial negotiations would come to an end. The master furthermore insisted that in his conversation with Myers in Norfolk, on the 21st, the latter engaged to furnish flour and logs for dead-weight. It is hardly credible that Myers, with an option, which would last for 17 days, to load entirely with cotton, or to substitute 100 tons of dead-weight cargo in part, would, before he had studied the plan of the ship then handed him, and before notice of her readiness to receive cargo, cut himself off from control in the matter by agreeing to furnish flour, which he did not have, or logs, which, as to most of those shipped from Norfolk and Newport News, are too light for dead-weight. The weight of proof, and the probabilities of the case, negative this claim of the master. The duty was upon the ship'of having ballast on board, or immediately at hand, under an express stipulation of the charter-party; and the master was bound by this provision to be provided with ballast before giving notice of readiness to receive cargo, notwithstanding any inferences he might have drawn individually, from the inquiring telegram or the interrogating conversation. The notice of readiness given on the 24th was not valid or binding on the charterers, for the'reason that the ship was not provided with ballast, and could not have sailed direct for Liverpool without it.

The state of things is similar in regard to the provisions of the charter-party that, “if any grain be shipped, it is to be loaded under inspection of underwriter’s surveyor,” and that,-when notice is given of the steamer’s readiness for cargo, “all of her holds shall have been cleared, and passed for grain.” The proofs show that when notice was given, on the 24th December, there was more or less water in hold No. 3, — the most capacious part of- the ship, — and that within the same week, when grain was to be put aboard under the second chartering, the underwriter’s surveyor required ceiling to be done, and boards and timbers put in, which work required about three days for accomplishment. The certificate of the two ex-mariners, Clayton and Adams, given some time on the 24th December,’that “the ship was fit for the stowage of any kind of cargo,” even if it had been in time, and even if the ex-mariners had been officers competent and authorized to “pass the ship for grain, ” was in point of fact untrue, and therefore worthless. It is not usual or safe to ship grain in a hold wet, from a blind leakage, without ceiling, and without protection by proper timbers. True, if, in the period of 17 lay-days during which the loading of the ship was proceeding, the charterers had found it to their interest to ship grain, then, in such event, these preparations might have been made; but the charter-party required, expressly, that the ship should be in condition to receive grain at the time of the notice. Certainly, this provision of the contract was not fulfilled by the ship.

! , I must-rule in a like manner in respect to coaling. The ship had not been coaled for the voyage on the 24t-h December. If loaded before coaling-,-instead of proceeding direct for Liverpool as required by an express stipulation, she would have had to proceed to Lambert’s Point or Newport News for coal, and then on her principal voyage. If such a divergence had been intended by the contracting parties, it would have been expressed. The custom of the port cannot enter into and change so material a part of the contract. Without coal on board, the ship was not ready to proceed, on receiving cargo, direct to her destination. Mr. Justice Lopes, of the admiralty appeals court of England, in the case of Groves v. Volkart, 1 Cab. & E. 309, a case tried by him in a suit at common law, laid down the law, generally, in regard to a ship’s readiness to receive cargo, as follows:

“ A ship, to be ready to load, must be completely ready in all her holds, — must he discharged in all her holds, — so as to afford the merchant eompiete control of every portion of the ship available for cargo. The merchant can then stow his cargo as he thinks most advantageous. In no other circumstances can a ship, by which I understand must be meant an entire ship, be placed at the disposal of a merchant. If any other construction is placed on the words * ready to load,’ it is obvious that great inconvenience would arise. It might be contended that a ship was ready to load when one hold only was empty, and a merchant might not have the rest of the ship placed at his disposal for an indefinite period. I doubt not but that the defendants were anxious, and schemed to be able, to cancel this charter-party; but still I am bound to give effect to what I believe to be its true meaning. A custom was set up by the plaintiffs to load and unload simultaneously, but it was not proved, — in fact, was disproved. ” Id.

Coal was obtainable by the Cambodia only at Lambert’s Point, three miles, or Newport News, thirteen miles, from Norfolk, where she was to complete her cargo. Non constat but that she might have got aground on her way to Lambert’s Point, as she did after loading under her second chartering, or have grounded at the pier in shifting her hatches. Delay from this cause was not only possible, but both probable and not unusual; and the master had no right to impose the risk of such delay upon the charterers, after having consumed seven or eight days more time in reaching Hampton Roads from Gibraltar than had been expected: most of the delay having occurred at her wharf in New York, from rainy weather. Whether unavoidable or not, the master had not succeeded in getting to Hampton Roads from Gibraltar with that alacrity described as the “life” of commerce by Mr.. Justice Swayne, in Lowber v. Bangs, 2 Wall. 728, where he said:

“Promptitude in the fulfilment of engagements is the life of commercial success. The state of the market at homeand abroad, the solvency of houses, the rates of exchange and of freight, and various other circumstances which go to control the issues of profit or loss, render it more important in the enterprises of the trader than in any other business. The result of a voyage may depend upon tlie day the vessel arrives at lier port of destination, and the time of her arrival may ho controlled by the day of her departure from the port whence she sailed. We.cannot forget these considerations in our search for the meaning of this contract.”

If this was a struggle between the master and the charterers as to which should bear the loss of the delay incident to Christmas week, surely the equities were with the charterers; and these were not required, by considerations of mercantile good faith, to subject themselves to the risk of the further delays that might attend the Cambodia in the process of coaling, after their disappointing experience with that ship from the tardiness of her arrival at Hampton Roads.

As to the times at which the notices of readiness to load were.given by the master, it is hardly necessary for me to say anything. Clearly, the notice of the 22d December, given after 12 o’clock, was invalid. I am inclined to think, however, that the telegraphic notice given on the morning of the 24th, received before 12 m., was in time, and would have been valid if the vessel had in fact been ready for cargo. Clearly, the letter written Sunday, the 23d, and not Received until after 12 m. Monday, was not in time. These questions of time of notice, however, are, in the case at bar, altogether immaterial. The ship was never ready to receive cargo. She had not the requisite 100 tons of ballast either on board or at hand. Even if she had the option to use coal as ballast, she had not that quantity of coal placed aft in the No. 3 deck. Nor was she on the 24th coaled for the voyage to Liverpool, and could not have proceeded thence direct after receiving her cargo. Moreover, she had coal in the main between-decks pross-bunkers, which was, therefore, not cleared for cargo, etc., and to which, according to the terms and spirit of the charter-party, the charterers had a right for cotton. On the whole case, I will sign a decree dismissing the libel, with costs.