Northwestern Commercial Co. v. Bartels

131 F. 25, 65 C.C.A. 263, 1904 U.S. App. LEXIS 4259
CourtCourt of Appeals for the Ninth Circuit
DecidedMay 3, 1904
DocketNo. 1,001
StatusPublished
Cited by1 cases

This text of 131 F. 25 (Northwestern Commercial Co. v. Bartels) is published on Counsel Stack Legal Research, covering Court of Appeals for the Ninth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Northwestern Commercial Co. v. Bartels, 131 F. 25, 65 C.C.A. 263, 1904 U.S. App. LEXIS 4259 (9th Cir. 1904).

Opinion

GILBERT, Circuit Judge,

after stating the case as above, delivered the opinion of the court.

The contention that the proceedings in the state court and the sale thereunder bar the present suit presents a question that has not been directly met by any decision of the Supreme Court. It is undoubtedly true that the fact that a libelant has already brought suit in a state court for the same claim is no bar to a subsequent proceeding in admiralty. The Highlander, 1 Sprague, 510, Fed. Cas. No. 6,476; The Kalorama, [28]*2810 Wall. 218, 19 L. Ed. 941. But it would seem that, if the proceedings in the state court have proceeded so far that a sale has been had upon its judgment, it would operate as a waiver of the lien, provided that the court assumed to sell the entire vessel and all rights and interests therein. In The Kalorama, the court, referring to the suggestion that the lien was waived by the commencement of an action for the same claim in the state court, said:

“But the record shows that the action is still pending, and it is well-settled law that the pendency of such an action is no bar to a suit in a federal court. Had the judgment been rendered, it might have been different.”

In Moran v. Sturges, 154 U. S. 277, 14 Sup. Ct. 1025, 38 L. Ed. 981, the court said:

“If, then, the receiver had first taken actual possession of these vessels and sold them, such sale would not have cut off maritime liens and the right to have them enforced; and while it may be true that the state courts exercising equitable jurisdiction might undertake in the distribution of property to save the rights of holders of maritime liens, yet it is certain that those courts would have no power by a sale under statute to destroy their liens, unless they had voluntarily submitted themselves to that jurisdiction.”

The inference to be drawn from this language of the opinion is that, if the lienholders had submitted themselves to the jurisdiction of the state court, the sale would have divested the vessel of their liens. In The Resolute, 168 U. S. 441, 18 Sup. Ct. 112, 42 L. Ed. 533, Mr. Justice Brown said:

“Did the order direct these vessels to be sold free of maritime liens or subject to them, or was it silent in this particular? Were the lienholders upon these vessels paid from the purchase money according to their relative rank as they would have been had the sale been conducted by a court of admiralty? If they were, that would amount to very strong, if not conclusive, evidence against the subsequent endeavor to enforce the liens in a court of admiralty.”

In Dudley v. The Superior and Sexton v. The Troy, 1 Newb. Adm. 176, Fed. Cas. No. 4,115, certain holders of maritime liens and non-maritime liens seized the vessels subject thereto by process from the state courts. Afterwards the boats were sold under the order of the court of admiralty, and the proceeds paid into the registry thereof. Holders of the nonmaritime liens asserted the right to share equally in the funds with those who held liens originally maritime, and who had not made seizures under the state law. The court expressed the view that a party who has voluntarily waived his admiralty lien and resorted to the local law for his indemnity and protection could not resume his lien at his pleasure, and thereby be reinstated in his original rights. So, in Stapp v. Steamboat Swallow, 1 Bond, 190, Fed. Cas. No. 13,305, it was said:

“It is, however, c-lenrly consonant with reason and the analogies of law that if a party having an undisputed maritime lien voluntarily waives it by seeking another remedy he cannot he reinstated in his original right.”

A case directly in point is The Mary Morgan (D. C.) 28 Fed. 196-202, in which the court said:

“I can recall no instance in which a creditor may sell his debtor’s property a second time for the same debt. lie invites the public to purchase, proposing [29]*29to take the proceeds while the purchaser takes the property. How can he afterwards, in effect, claim the property also?”

It would seem, in view of these decisions and expressions of the court, that under the admiralty law applicable to the enforcement of liens one who participates in such a proceeding in a state court resulting in a sale at his instance, loses his lien, if not by estoppel, at least by laches. The Seminole (D. C.) 42 Fed. 924.

But aside from the question of estoppel by the judgment and sale under the proceedings of the state court or the laches of the appellee, we think his conduct and representations to the appellant estop him now to assert a lien against the vessel. He duly presented his claim to the receiver in the state court, and his claim was allowed. After that court had ordered the sale of the vessel, he went to the officers of the appellant, and urged them to become purchasers at the sale. At the time of the sale he was present, conferring with the president of the appellant; and when the latter inquired of the receiver if all claims against the vessel were included in the proceedings, and the receiver replied that they were, the appellee made no denial of that statement. A month later, and after the sale had been confirmed, he appeared with his attorneys before the state court, and he testified concerning his claim and the items thereof. It was not until the court had announced its decision adjudging Clark’s lien to be prior to his that the appellee withdrew his claim. He testified in the present case that prior to the sale he stated to Williams, the treasurer of the appellant, that he thought the vessel would sell for about a thousand dollars, and that he would get practically all the proceeds after payment of the receiver, and that he further said that, if the appellant would buy her, the money that she was sold for would come to him, and that Williams “was satisfied to that effect.” In what plainer language could he have informed the appellant that his claim was included among those for the satisfaction of which the vessel was to be sold? The force of his statement to Williams is not modified by the fact that he testified that he further said that he calculated to get his money out of that vessel, no matter what became of her, or who would buy her. The plain inference to be drawn from all that he said was that he looked to the proceeds of that sale to satisfy his lien, and that Williams was satisfied to that effect. He does not deny that he told the secretary of the appellant that liens had been filed with the receiver, and that the schooner was going to be sold, and that among other claims was his own. The learned judge of the District Court was of the opinion that, if the proof showed that the appellee induced the claimant to purchase the vessel by making a verbal agreement to relinquish his claim and to look to the purchase money, and that the amount bid was sufficient to pay him any considerable part of the amount which he was justly entitled to receive, there would be substantial ground for an estoppel, but that there could be no estoppel from the facts proved for the reason that the amount bid was not sufficient to pay him anything. We think that the fact that the amount bid was not sufficient under the order of distribution made by the state court to pay the appellee anything is wholly immaterial to [30]*30the question under discussion. The estoppel consists in the appellee’s conduct and representations and the act of the appellant thereby induced.

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Bluebook (online)
131 F. 25, 65 C.C.A. 263, 1904 U.S. App. LEXIS 4259, Counsel Stack Legal Research, https://law.counselstack.com/opinion/northwestern-commercial-co-v-bartels-ca9-1904.