In re Complaint of Northern Transatlantic Carriers Corp.

300 F. Supp. 866, 1969 U.S. Dist. LEXIS 10772
CourtDistrict Court, D. Puerto Rico
DecidedJune 30, 1969
DocketCiv. No. 278-68
StatusPublished
Cited by2 cases

This text of 300 F. Supp. 866 (In re Complaint of Northern Transatlantic Carriers Corp.) is published on Counsel Stack Legal Research, covering District Court, D. Puerto Rico primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In re Complaint of Northern Transatlantic Carriers Corp., 300 F. Supp. 866, 1969 U.S. Dist. LEXIS 10772 (prd 1969).

Opinion

MEMORANDUM — ORDER

FERNANDEZ-BADILLO, District Judge.

This cause came to be heard on a motion to dismiss filed by the claimant, The Commonwealth of Puerto Rico, against the plaintiffs’ counter-claim and set-off filed on July 18,1968.

On March 3, 1968, the SS Ocean Eagle broke in two in the entrance to the San Juan Harbor. On April 29, 1968, the plaintiffs herein filed a petition seeking to limit their liability under the Limitation of Liability statute of the United States, 46 U.S.C.A. § 181 et seq.

On June 14, 1968, the Commonwealth of Puerto Rico filed a claim in the limitation of liability proceeding alleging among other things that the plaintiffs had no right to limit their liability; that the SS Ocean Eagle was in an unseaworthy condition since the moment it left Puerto de la Cruz, Venezuela; of which condition the plaintiffs had full privity and knowledge; and that the breaking in two of the SS Ocean Eagle was due to the unseaworthy condition of the ship and/or of the negligence of her master and/or crew.

On July 18, 1968, the plaintiffs filed a counter-claim against the Commonwealth of Puerto Rico alleging in substance that the occurrence of the accident was due to the inadequacy of facilities at the San Juan Harbor and was caused by the negligent acts or omissions of the Commonwealth of Puerto Rico and move the court to grant plaintiffs the sum of approximately $2,000,000.00 in damages.

On July 22, 1968 the claimant, the Commonwealth of Puerto Rico, moved this court to dismiss the counter-claim and set-off. The claimant’s contention in this court was two-fold; Firstly, the claimant contended that the Commonwealth of Puerto Rico could not be sued or counter-claimed without its consent. Secondly, it contended that the plaintiffs failed to comply with Law 104 of June, 1955, as amended, 32 L.P.R.A. § 3077 et seq., which requires prior notice be given to the Secretary of Justice of the Commonwealth of Puerto Rico, as a jurisdictional requirement to an action for damages against the Commonwealth of Puerto Rico. The court agrees with this contention.

The Commonwealth of Puerto Rico has full power of local determination with autonomy similar to that of a State of the Union and possesses many of the attributes of sovereignty possessed by the States, immunity of suit being one of them. Porto Rico v. Rosaly y Castillo, 227 U.S. 270, 33 S.Ct. 352, 57 L.Ed. 507, 1913; Puerto Rico v. Shell Company, 302 U.S. 253, 58 S.Ct. 167, 82 L.Ed. 235, 1937; Bonet v. Yabucoa Sugar Company, 306 U.S. 505, 59 S.Ct. 626, 83 L.Ed. 946, 1939. The present Commonwealth status has not altered Puerto Rico’s sovereign immunity. Krisel v. Duran, 258 F.Supp. 845, aff’d, 386 F.2d 179, 1967; Alcoa Steamship Co., et al. v. Perez, 295 F.Supp. 187, 1968; Salkin v. Commonwealth of Puerto Rico, 408 F.2d 682 (1969 1st Cir.).

Although the plaintiffs seem to recognize the sovereign immunity of the Commonwealth of Puerto Rico, their contention is that the Commonwealth waived its sovereign immunity by filing its claim in the limitation of liability proceeding. This is not so. The limitation of liability act was enacted mainly to encourage ship building and the maritime industry in general. Just v. Chambers, 312 U.S. 383, 61 S.Ct. 687, 85 L.Ed. 903, 1941; Coryell v. Phipps, 317 U.S. 406, 63 S.Ct. 291, 87 L.Ed. 363, 1943; Gilmore and Black, the Law of Admiralty, Chapter X. Once the court in a limitation of liability proceeding acquires jurisdiction, it is exclusive of all other forums; Langnes v. Green, 282 U.S. 531, 51 S.Ct. 243, 75 L.Ed. 520, 1931; Ex parte Green, 286 U.S. 437, 52 S.Ct. 602, 76 L.Ed. 1212, 1932; The Central [868]*868States, D.C., 9 F.Supp. 934, 1935. Furthermore, an admiralty court can enjoin a State from bringing a suit in the State court after the limitation of liability has been filed. The Central States, supra. This is so, because whichever rights the State had arising out of the incident must be litigated in the limitation of liability proceeding. Otherwise, the sovereign would be forever barred from instituting any suit in any other court, United States v. Hamburg American Line, 2 Cir., 212 F. 40, L.R.A.1917C, 1103, 1914. Thus the Commonwealth of Puerto Rico had to file its claim in the limitation of liability proceedings or run the risk of losing its rights.

The result reached by us is not altered by the fact that this court is sitting in admiralty. A unanimous court in In re State of New York, 256 U.S. 490, 41 S.Ct. 588, 65 L.Ed. 1057, 1921, held: “That a state may not be sued without its consent, is a fundamental rule of jurisprudence having so important a bearing upon the construction of the Constitution of the United States that it has become established by repeated decision of this court that the entire judicial power granted by the Constitution does not embrace authority to entertain a suit brought by private parties against the state without consent given. * * *.”

“Nor is the admiralty of maritime jurisdiction exempt from the operation of the rule.”

In support of their contentions the plaintiffs cited Luckenbach SS Co., Inc., et al. v. The Thekla, 266 U.S. 328, 45 S.Ct. 112, 69 L.Ed. 313, 1924. In that case it was held that when the United States comes into a court to assert a claim it so far takes the position of a private suitor as to agree by implication that justice may be done with regard to the subject matter. Nonetheless, that case is distinguishable from the case at bar in that a collision was involved. As stated in United States v. Shaw, 309 U. S. 495, 60 S.Ct. 659, 84 L.Ed. 888, 1940, “There is little indication in the facts or language of The Thekla to indicate an intention to permit generally unlimited cross-claims,” at page 503, 60 S.Ct. at page 662. The Court further- held: “The subject matter of a suit for damages in collision is not the vessel libelled, but the collision. Libels and cross-libels for collision are one litigation and give rights to one liability. In equal fault, the entire damage is divided. As a consequence, when the United States libels the vessel of another for collision damages and a cross-libel is filed, it is necessary to determine the cross-libel as well as the original libel to reach a conclusion as to liability for the collision.”

Furthermore and distinct from the present case, The Thekla ruling was motivated by obvious consideration of public policy enacted into law in the Suits in Admiralty Act of 1920, 46 U.S.C.A. § 742. In the Thekla case the United States was the owner, pro hac vice, of the SS F. J. Luckenbach, one of the vessels involved in the collision, object of the case.

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300 F. Supp. 866, 1969 U.S. Dist. LEXIS 10772, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-complaint-of-northern-transatlantic-carriers-corp-prd-1969.