The Malcolm Baxter, Jr.

253 F. 486, 1918 U.S. Dist. LEXIS 864

Opinion

LEARNED HAND, District Judge

(after stating the facts as above). [1] There is no absolute certainty that the claimant would have failed in performance. That he was willing to try must be assumed, and if he is to be treated as in default it can only be upon the hypothesis that the Baxter could hy no possibility have escaped the blockade. That her chances were very slight is true enough, but the conclusion in some part must rest in supposition, for perhaps some schooners did slip through, and she might have been one. When, as here, the obligor remains willing, nothing short of certainty can impose upon him a default on the score of impossibility. Hence the case really fails at the outset.

[2] Passing this point, and assuming that the case is to be judged as though the Baxter had been restrained in her voyage by princes or peoples, the case is still with the claimant. I shall assume, without deciding, that the absence of any exception put the owners in default, though the voyage were frustrated by the restraint of princes; still, viewing the charter party as a whole, it seems to me clear that in accepting any such risk the owners provided for their safety by the clause written into the charter party that the cargo should be consigned to the Netherlands Overseas Trust. This the libelant answers by saying that the words mean no more than that the bill of lading should be in favor of the Trust, just as in an ordinary consignment. The libel itself contains allegations which refute that interpretation. The situation was this: No cargoes could go forward to Holland without the consent of the Trust, which was the only agency trusted by Great Britain to distribute supplies to the Dutch. The Trust was not the true consignee in the usual sense at all; all it did was to insure to Great Britain’s satisfaction that the cargoes should not leave Holland. As a part of the system the preliminary consent of the Trust was necessary. With such a consent the ship could pass the British cordon; without it, it would be stopped, if detected.

There was, therefore, no conceivable reason for a clause, certainly intended to expedite the ship, which went no further than to provide for a consignment to the Netherlands Overseas Trust in the'usual sense. Such a provision would not have helped the ship; rather it would have excited suspicion, and promoted delays and eventual discharge in a British port, if, upon being overhauled by a cruiser, the bill of lading had shown the consignment of a cargo to whose entry the Trust had not consented. It is clear, therefore, that the provision must be read in the light of the surrounding facts, all set forth in the second article of the libel, showing that the permit of the Trust was considered as a condition to a consignment of the cargo.

An analysis of the succeeding clause, also written into the charter party, makes this conclusion stronger. It is provided that for any detention over 48 hours by Great Britain or her allies the charterer shall pay demurrage. Now, if it were intended that the cargo might be consigned to the Netherlands Overseas Trust without its consent, this imposed upon the charterer a prohibitive risk.' Such a consignment would not have protected the ship, but, on the other hand, would have stopped the voyage altogether. It was hardly intended that the charterer must go on indefinitely paying demurrage, yet it is hard to see how demurrage could stop-, at least before the ship was discharged. What was intended was that she should be protected by a consignment fortified by a permit, which -would shorten detention and insure the completion of the voyage. It is therefore unreasonable to suppose that, with such a provision in the charter party for demurrage, either party meant to attempt a venture, dependent upon tire ability of a sailing vessel to escape the'British cordon, and to impose upon the charterer a vague and extremely onerous liability, if she did not.

Hence from every view it seems to me clear that the consignment presupposed a preliminary permit, and this the libelant never procured. Performance of that covenant was a condition precedent to performance by the owners, who were not obliged to carry any cargo other than that described. Thus they are not in default, and the rule in The Gracie D. Chambers, 253 Fed. 182,- C. C. A. - applies. Indeed, since the default was the cause of the frustration of the voyage, it is not necessary to invoke the rule in that case, for, if the charterer defaults in his covenants, he is in no event in a position to recover.

The libelant’s argument does not impress me, based upon the improbability of such a contract. I see no reason to suppose that it anticipated any difficulty in getting the permit. The “Widow Cleyndert” had already got the permit of November 14, 1916, and it must have seemed an easy thing to secure the slight change necessary. Unhappily the general situation had also changed, and performance had become impossible. That, under the hard rule which the charterer itself invokes, would not excuse performance. Even if it would, the case would then stand with each party excused by impossibility of performance, in which event the rule in The Grade 'D. Chambers would again apply.

Prom the best possible aspect, therefore, that case controls, and the libel must be dismissed, with costs.