Ishverlal Madanlal & Co. v. SS Vishva Mangal

358 F. Supp. 386, 1973 U.S. Dist. LEXIS 14079
CourtDistrict Court, S.D. New York
DecidedApril 11, 1973
DocketNo. 68 Civ. 4503
StatusPublished
Cited by1 cases

This text of 358 F. Supp. 386 (Ishverlal Madanlal & Co. v. SS Vishva Mangal) is published on Counsel Stack Legal Research, covering District Court, S.D. New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Ishverlal Madanlal & Co. v. SS Vishva Mangal, 358 F. Supp. 386, 1973 U.S. Dist. LEXIS 14079 (S.D.N.Y. 1973).

Opinion

MEMORANDUM AND ORDER

BRIEANT, District Judge.

Defendants move for summary judgment dismissing the complaint, solely as to plaintiff “Director General of the India Supply Mission for and on behalf of The President of the Union of India” (hereinafter “Supply Mission”), pursuant to Rule 56, F.R.Civ.P., on the ground that there exists between plaintiff Supply Mission and defendants, no real “ease or controversy” over which the Court may exercise jurisdiction under Article III, Section 2, Clause 1 of the Constitution.

There are no disputed issues of material fact. Plaintiffs are the owners of mixed cargo aboard the steamship VISHVA MANGAL. A fire occurred aboard the vessel on October 20, 1967 at Searsport, Maine.

Jurisdiction is founded on 28 U.S.C. § 1333. The dispute arises out of a maritime contract of carriage evidenced by a bill of lading issued by the Master of the VISHVA MANGAL at Pascagoula, Mississippi for 100,000 bags (5,000 metric tons) of ammonium phosphate owned by Supply Mission for discharge at Madras or Calcutta, India. Liability is founded upon claims of unseaworthiness and negligence.

Defendant vessel and her owner' entered a general appearance in thig Court, presumably because the vessel could have been arrested within this District.

While the action is, at least in name, between the owner of the cargo, and the vessel or her owners, in actuality, as Chief Judge Friendly of this Circuit has remarked [Leather’s Best, Inc. v. S. S. MORMACLYNX, 451 F.2d 800, 815 (2d Cir. 1971)], “. . . the cargo insurer-er [is] admittedly the true plaintiff here.”

Permitting insurers of cargo to sue as subrogees in the name of the owners is a long standing admiralty tradition. As expressed in Colinvaux, Carver’s Carriage By Sea, 12th ed. (London, 1971) vol. 2, p. 1183:

“Underwriters entitled to benefit. And if the person who has been damnified was insured against such a loss, and has been indemnified by the underwriters, he may still sue f<pr compensation on their behalf. They are entitled to the benefit of his right of action, either against the wrongdoer, [388]*388or against the shipowner on the contract, where the loss is one for which he has undertaken responsibility, and they may claim to sue in the name of the assured upon properly indemnifying him.”

Against fendants assert that because of the peculiar status of the nominal parties, this litigation may not proceed, because it is not an actual “case or controversy” within the meaning of Article III of the Constitution, which limits our jurisdiction.1

Plaintiff Supply Mission is an arm of the President of India.2 Supply Mission performs a governmental function, that is acquisition of and delivery to the Indian people of goods such as the instant cargo, needed for relief, economic development or warfare.

Defendants urge in support of this motion that The Shipping Corporation of India, Limited, owner of the VISHVA MANGAL, is likewise an arm of the Government of India, and that the government can’t sue itself, because such a suit would not be a “case or controversy”.

The Shipping Corporation was formed as a result of the merger of a corporation owned solely by President of India, with Western Shipping Corporation Limited (“Western”), a private company. This merger was effected in 1961 by the Indian Government, as an act of state, by an order or decree entitled “The Shipping Corporations Amalgamation Order”.

This order of amalgamation provided [f7(i)] that the Western shareholders would receive shares “equivalent in number and value” in the resultant corporation, to the shares they held in Western prior to the merger.

Articles of Association were issued pursuant to the order, providing for the regulation of the affairs of the resulting company, defendant here. These articles contain several provisions which appear to recognize the existence of present, or possible future beneficial economic interests of private shareholders. For example, under article 9 thereof, the Corporation has a lien on the proceeds of sale of stock by a shareholder. This implies that a shareholder has at least some limited right to sell, on compliance with other provisions which require approval by the President of India. Article 21(1) authorizes the President of India, “so long as he is a member of the Company”, to appoint a representative to attend meetings. This provision contemplates the possibility that the Government of India might at some future time choose to sell, transfer or distribute its shares in some manner, and cease to be the controlling shareholder.

There are 13 individual named shareholders, holding a total of 710 shares of stock of the Corporation.

The affidavit of Shashi Ran jan Prasad, sworn to July 17, 1972, indicates that Mr. Prasad is Administrative Director and Secretary of the Shipping Corporation of India, Limited, and has been associated with the Corporation since October 2, 1961. He advises as follows:

“Although some shares in the capital of the Shipping Corporation are technically owned by the individual officials of the Government of India, and other persons, in effect all of the share capital of the Corporation is owned by the President of India rep[389]*389resenting the Government of India, since all individual shareholders are nominees of the President of India.
All revenues received by the Corporation are considered its internal revenues and none is covered (sic) directly into the Treasury of the Government of India. However, whenever a year of operation discloses a surplus or profit, dividends may be declared, as they are from time to time, and all dividends on such shares of the corporation are paid to the President of India and none are retained by the individual shareholders. ...”

The shares are not traded on the market, and dividends are not taxable.

Plaintiff asserts that issues of fact' exist with respect to the status of these shares and the owners, but sets forth no specific facts showing that there is a genuine issue for trial. He has not discharged the requirement to “at least specify some opposing evidence which it can adduce and which will change the result”. Radio City Music Hall Corp. v. United States, 135 F.2d 715, 718 (2d Cir. 1943), cited with approval in Donnelly v. Guion, 467 F.2d 290, 293 (2d Cir. 1972).

Movant relies on Defense Supplies Corp. v. United States Lines Co., 148 F.2d 311 (2d Cir. 1945), cert. denied 326 U.S. 746, 66 S.Ct. 43, 90 L.Ed. 446, which affirmed dismissal of a cargo libel brought against the United States under the Suits in Admiralty Act. The libellant was a corporation whose stock was wholly owned by Reconstruction Finance Corporation, the stock of which in turn was wholly owned by the United States.

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358 F. Supp. 386, 1973 U.S. Dist. LEXIS 14079, Counsel Stack Legal Research, https://law.counselstack.com/opinion/ishverlal-madanlal-co-v-ss-vishva-mangal-nysd-1973.