Schmidt v. The George Nicholaus

21 F. Cas. 705, 1855 U.S. Dist. LEXIS 113

Opinion

HELD

BY THE COURT:

That on the finding of the facts as above set forth, there was an absolute necessity that the bark should have the repairs, and there was no way in which the master could procure them except by bottomry. The price which she (a foreign vessel] brought at a forced marshal’s sale in this port would be very inadequate proof of her value at Rio. or that she was not worth repairing there, as claimed by the respondents. That a master of a vessel in a foreign port has the righT. in case of necessity, in hypothecate his cargo as well as his ship and freight, for repairs which are necessary in order to carry the cargo to its destination— a power given him by the law, without any express authority from the owners, and required by the necessities of navigation and commerce.

In an ordinary state of things, the master of a vessel is a stranger to the cargo, when it is owned by a freighter, except for the purposes of safe custody and conveyance. But in cases of unforseen necessity, the character of agent is thrown upon him, not by the appointment of the owner, but by the policy of the law. The necessities of navigation give power to a master in certain .cases to control and dispose of the cargo of a general freighter, and give him power and authority over it, adequate to the purpose of discharging his duty of delivering it at its destination. In such eases of severe necessity the law makes him the agent of the owners, and as such he is authorized to do what it is presumed the owners would do. Hence, as is well settled, in case of necessity he may sell perishable articles; or he may sell part of the cargo to enable him to pursue his voyage and carry the balance to its destination; or he may destroy the cargo by throwing it overboard if necessary to save the ship. This power of selling a part or the whole of the cargo, or of destroying it, is not given him by the owners, but is thrown upon him by the law, and whatever he does by virtue of it is as binding upon the owners as if they had expressly authorized it. This power of the master has long been recognized by the courts of admiralty. His power to hypothe-cate the whole cargo instead of selling a part of it, to enable him to prosecute his voyage, was not recognized by the courts until a more recent period, but it had been the practice of shipmasters to do so some time before it had been expressly decided by any admiralty decision that they had the legal right to do so. No express decision legalizing the practice was hud until the case of The Gratitudine, 3 Rob. Adm. 240, in which Sir William Scott decided that the master had such right. The law as laid down in that case has not been questioned in subsequent cases which have arisen. Judge Story, in the case of The Packet [Case No. 10,6541, says: “The case of The Gratitudine has established upon the most satisfactory and conclusive grounds the right of the master in a case of necessity to hypothecate the cargo as well as the ship and freight.”

But it is claimed by the respondents that although this is the law, yet where the master has an opportunity to tranship, it is his duty to do so, and that when he has such opportunity. and that is known to the bottomry lender, he cannot hypothecate the cargo for the repairs of the vessel. In certain cases, as, for instance, where a vessel is unseawor-thy and unfit to be repaired, or where the master cannot raise funds to repair her, it may be his duty to tranship. But where the ship can be made seaworthy within a reasonable time, and the master can raise funds for that purpose by hypothecating the ship, freight and cargo, there is no law which so makes it the duty of the master to tranship that if he fails to do so he shall not have the power to hypothecate. That was expressly decided in the case of The Gratitudine, which is sustained by Judge Story in the case of The Packet [supra]. The master is not deprived of the power to hypothecate, because : he can tranship, nor is the lender on bottom-ry deprived of his right to look to the cargo , hypothecated, because he had good reason to believe that the master could tranship if he chose. If this were so, then the rule that the master may in case of necessity hypothecate his cargo for the repairs for his ship would be abrogated in this port and other large commercial ports, because he would at all times have it in his power to tranship his cargo on board another vessel. The decree therefore must be in favor of the libelants. The balance of the proceeds of the bark, remaining in the registry of the court, and the freight money, must be first applied to the payment of the libelants’ demand, and the i balance then remaining due must be paid by the cargo.