The Lady Franklin

14 F. Cas. 931, 1 Biss. 557

• Court: U.S. Circuit Court for the Northern District of Illnois
• Decided: January 15, 1867
• Status: Published

Opinion

DAVIS, Circuit Justice.

This case is within the principle of the decision of Pratt v. Reed, 19 How. [60 U. S.] 359. I understand that case to decide that in order to a valid maritime lien upon a vessel for supplies and repairs, it must appear not only that such repairs and supplies were needful to the vessel when furnished, but that the existence of some unforeseen and unexpected emergency, making it necessary to procure such supplies and repairs at such time upon the credit of the vessel, must also be shown; and that the circumstances under which such supplies and repairs are furnished, must be such as would, under the maritime law, have justified and sustained the giving at such time a bottomry bond, for the same repairs and supplies; the only difference being that, in the case of the giving a bottomry bond, it must further appear that there was a necessity for paying the extraordinary interest incident to that security. It was further ruled in that case, “that the supplies having been furnished at a fixed place according to the account current, and apparently under some general understanding and arrangement, the presumption is that there could be no necessity for the implied hypothecation of the vessel, — there could be no unexpected or unforeseen exigency to require it; and that for aught that appeared, the supplies could have been procured on the personal credit of the owner.”

NOTE. This claim was one of a number filed at the same time and submitted to Judge Drummond, who ruled that, in his opinion, they constituted, under the general maritime law, valid liens upon the vessel, but doubted whether, under the rulings of the supreme court in Pratt v. Reed, they could be sustained, and suggested that the case be heard before Justice Davis, and ms judgment be entered in each case as the judgment of the district court, which waj done, and the above opinion rendered. In the case of The Grapeshot, 9 Wall. [76 U. S.] 129. the supreme court go into an extended discussion of the doctrine of maritime liens for repairs and supplies, and sum up the doctrine of maritime hynothecation in the following propositions: 1st. JUiens for repairs and supplies, whether implied or express, can be enforced in admiralty only upon proof made by the creditor that the repairs or supplies were necessary, or eblieved upon due inquiry and credible representation, to be necessary. 2nd. Where proof is made of necessity for the repairs or supplies, or for funds raised to pay for them by the master, and of credit given to the ship, a presumption will arise, conclusive, in the absence of evidence to the contrary, of necessity for credit. 3d. Necessity for repairs and supplies is proved where such circumstances of exigency are shown as would induce a prudent owner, if present, to order them or to provide funds for the cost of them on the security oí the ship. 4th. The ordering by the master of supplies or repairs upon the credit of the ship, is sufficient proof of such necessity to support an implied hypothecation in favor of the material-man, or of the ordinary lender of money, to meet the wants of the ship, who acts in good faith. 5th. To support hypothecation by bottomry, evidence of actual necessity for repairs and supplies is required, and. if the fact of necessity be left unproved, evidence is also required of due inquiry and of reasonable grounds of belief that the necessity was real and exigent. ■See. also. Thomas v. Osborn, 19 How. [CO TJ. S.] 22; The James Guy [Case No. 7.196]; The Sea Lark [Id. 12.579]: The Sarah Starr [id. 12.-354]: The Eledona [Id. 4.340]: The Washington Irving [Id. 17.24J]; The John Lowe [Id. f,-350].

Applying to this case the principles of the above decision, in which I entirely concur, the claim of the libellants cannot be sustained. There is nothing in the case which establishes such a case of maritime necessity for a credit upon the vessel as would alone sustain the lien which the libel seeks to maintain. There was no unexpected or unforeseen emergency. The vessel was in her regular course of business, at one of her established ports of arrival and departure. She was running between Toronto and Os-wego, upon a charter-party with the Grand Trunk Railway, and Oswego was one of her regular ports for procuring the usual and needful repairs and supplies which were required by her from time to time upon the successive trips performed by her. It is obvious that proper provision should be made by those who were running her to meet such running expenses. The freight money earned upon the charter should have supplied her with sufficient funds for that purpose.

To allow vessels to be subject to secret maritime liens to those furnishing her with her usual supplies on her regular trips, and at her usual ports of entry and discharge upon such trips, would be injurious to the best interests of commerce. If this were to be permitted, the interests of the parties having mortgages upon vessels, and of owners letting vessels upon charters, would be greatly jeopardized, and the vessel practically could be run at their cost.

In addition to the absence in this case of any evidence of any such unforeseen and unexpected emergency as would justify a maritime lien upon the vessels for the repairs and supplies furnished, even in a case where it satisfactorily appeared that the owner of the vessel had no personal credit in the port of supply, the proof in this case Tails to furnish sufficient evidence of the inability to procure such supplies and repairs upon the credit of the owner. It is not sufficient to show that the parties furnishing such supplies did not know that the owner had a credit. They are bound to proper and reasonable diligence in making inquiries as to such credit, and the inability to obtain such supplies, upon such credit, ought to appear by showing proper efforts so to obtain them.

In this case, the supplies and repairs were charged at once to the vessel. No inquiries were made as to the owner’s responsibility, nor does it appear that the owner was without credit at the port of supply. It appears that the vessel was run upon a charter, and was to receive so much for each trip, and that these earnings were received by the master and owner, and these facts would rather furnish ground for the presumption that they had the means either to pay for the needed supplies, or to obtain a personal credit for the amount of them; and as no attempt was made by communicating with the owner, or otherwise, to raise the needed amount in this way, the language of the supreme court in Pratt v. Reed [supra] may be appropriately applied to this case; that, “for aught that appears, the supplies could have been procured on the personal credit of the owner.”

Libel dismissed.

For cases on hypothecation, see Skrine v. The Hope [Id. 12,927]; O’Hara v. The Mary [Id. 10,467]; Boreal y. The Golden Bose [Id. 1,658]; Sloan y. The A. E. I. [Id. 12.946]; Liebart y. The Emperor [Id. 8.340]; Turnbull y. The Enterprise [Id. 14,242]; Forbes y. The Hannah lid. 4,925]; Cainzares y. The Trinidad [Id. 2,-383], In a case lately decided in the district of Oregon, The Augusta [Id. 647], November, 1S72, Deady, J., holds that under rule 12, in admiralty, as amended, May 6, 1872, a material-man has, by the general maritime law, a lien upon the ship which may be enforced in admiralty, whether the ship be domestic or foreign, or whether in a home or foreign port. In The Cir-cassian [Id. 2,720a], November, 1872, Blatch-ford, J., ruled that this amendment to the rule did not apply to supplies furnished previous to May 6th, before which time necessaries furnished to a vessel in her home port did not constitute a lien under the maritime law. Consult, also. The Celestine i*a. 2,541]; The Self [Id. 12,649], October term, 1S72.