The Velocity

28 F. Cas. 1138, 13 Law Rep. 61, 1850 U.S. Dist. LEXIS 8
CourtDistrict Court, N.D. New York
DecidedFebruary 2, 1850
StatusPublished

This text of 28 F. Cas. 1138 (The Velocity) is published on Counsel Stack Legal Research, covering District Court, N.D. New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
The Velocity, 28 F. Cas. 1138, 13 Law Rep. 61, 1850 U.S. Dist. LEXIS 8 (N.D.N.Y. 1850).

Opinion

CONKLING, District Judge.

The question whether the court can properly afford the relief sought by the petitioners, being one of considerable importance, not only to them but to the public at large, I have been anxious since the petitions were exhibited, to give to the subject the best consideration in my power. So far as I am informed, the question is wholly new: it is so, at least, in this court. This, however, is not the first time that the attention of the court has been called to the statute of Ohio, under which the question arises. It being a settled doctrine of our maritime jurisprudence, that where a lien is given to the material-man by the law of a state, such a lien may be enforced by a suit in rem in the admiralty, notwithstanding the supplies have been furnished in a home port; several applications were made to the court in behalf of citizens of Ohio, not long after the passage of the late act of congress, imposing a quasi admiralty jurisdiction on the district courts, of certain cases arising on the lakes, for original process of arrest against vessels owned in Ohio, to enforce payment for supplies furnished in that state.- But for reasons then assigned, and without entering into a critical examination of the act, for the purpose of ascertaining whether it conferred a lien enforceable by admiralty process in the district of Ohio, my opinion was, that I should not bs warranted, as the judge of this district, in assuming the jurisdiction thus invoked, and I accordingly declined its exercise. And in a recent case which it was supposed might turn upon a sale of the vessel under process from a court of the state of Ohio, in pursuance of this act, its provisions were again brought into discussion. The case, however, was decided upon other grounds. With regard to the particular question, which it has now at length become my duty to decide, although it has been repeatedly mentioned in court, I have cautiously abstained from intimating any opinion upon it (for in truth I had formed none), contenting myself, when declining to entertain original suits founded upon it, for demands of this sort, with saying, that if parties so situated were entitled to relief in any form, in this court, it could only be by a suit against surplus proceeds.

Having thus explained the actual predicament of the question in this court, I proceed in the next place, as well as I am enabled by the light of judicial decisions to do, to state the general principles on which the rights of the petitioners depend. These principles are of no inconsiderable practical importance. Vessels of great value are sometimes allowed by their owners to be sold, to satisfy demands of comparatively small amount; and as the entire proceeds of sales under the process of the court are in all cases paid into the registry, it thus happens that in some instances a large sum, and in most instances, a portion of the proceeds, remains, after payment of the amount decreed to the libellant, and to peti-

[1139]*1139tioners, if any (as there generally are in this court), who, also having maritime liens against the vessel, intervene for their interest, pen-dente lite. Of sums so remaining in the registry, the court is bound to make a just disposition; and in discharging this duty, to proceed with the same cautious circumspection, and the same strict regard to law and justice, as in the decision of original suits. Prima fa-cie, such surplus belongs to the person who was the owner of the vessel before sale; and no reason to the contrary appearing, it is a matter of course to direct its payment to him —proper care being first taken, especially if he had not before appeared and been admitted as claimant, to ascertain with legal certainty that he was in fact such owner. But the right of' intervention continues, notwithstanding the consummation of proceedings in the original suit, and may be exerted by petition against the fund remaining in the registry; and with respect to demands which constituted a lien on the Ship in specie, and of which, therefore, the court might have taken cognizance in an original suit, no doubt has ever been entertained, that the court has authority and was bound to direct their payment out of such surplus fund. To decree a sale of the property to which the lien attached, equally with that on account of which the property had been brought under the power of the court, and thus to give to a third person, as purchaser, an indefeasible title to it, discharged of such lien —and then to direct the payment of the surplus proceeds to the debtor, in preference to the holder of such lien, would be manifestly unjust. On the other hand, however, it has never been supposed that the claims of the mere general creditors of the owner could be recognized in this form. It is true, indeed, in England, although, latterly, until by a recent act of parliament (3 & 4 Vict. c. 63) the law was changed, material-men, even in the case of a foreign vessel, were held not to have a lien on the ship, that it was the practice of the high court of admiralty, nevertheless, to direct their payment out of surplus proceeds, provided the demand was liquidated and undisputed: but it seems to have been done under the idea, that this might be rightfully regarded as a remnant of the authority formerly exercised by the court, to entertain original suits in favor of material-men, but subsequently restrained by prohibitions from the courts of common law. The Neptune. 3 Hagg. Adm. 129. But claims depending wholly upon the common law were uniformly rejected as not cognizable in the admiralty at all; and so rigorously was this principle enforced, that even mortgagees and judgment creditors after levy on execution, were excluded. The Portsea, 2 Hagg. Adm. 84; The Exmouth, Id. 88, note; The Fruit Preserver, Id. 181; The Prince George. 3 Hagg. Adm. 376; The Percy, Id. 402; The Flora, 1 Hagg. Adm. 298, 303. In the case last cited, however, in which the high court of admiralty directed the surplus proceeds to be paid to the owner, in preference to the sheriff who had levied upon the ship before its arrest by the admiralty process, the court of delegates, on appeal, ordered the money to be paid to the sheriff, being of opinion, that “although the court of admiralty cannot enter into the concracts of general creditors, yet it may be bound to take a judgment on record as a debt.” And, now, by a late act of parliament (3 & 4 Yict. e. 65), that court is authorized to give relief to mortgagees.

In our own courts, the first reported case I have met with, in which the right of intervention against surplus proceeds was discussed, is that of Gardner v. The New Jersey [Case No. 5,233], decided by Judge Peters in 1806. At that time, the only reported English case, tending to shed any light on the subject, which had probably readied this country, was that of The Favourite. 2 C. Rob. Adm. 232, in which Sir William Scott alluded to a practice of the court, allowing the claims of material-men against surplus proceeds in the case of a foreign ship. The views of the subject then entertained by Judge Peters, may be gathered from his own words in the following extract from his juugment, in the above cited case of the New Jersey, in which a petition against the surplus proceeds of the sale of the vessel was exhibited in behalf of the master, for money by him advanced on account of the ship, and another in behalf of a person who served on board in the capacity of physician, during a voyage from Philadelphia to Canton and back again: “When I first came into this court, I made, in several instances, distribution of surplus moneys, under the idea that I had power to do so, agreeably to the doctrine now stated, to justify me in granting the prayers of the petitions.

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28 F. Cas. 1138, 13 Law Rep. 61, 1850 U.S. Dist. LEXIS 8, Counsel Stack Legal Research, https://law.counselstack.com/opinion/the-velocity-nynd-1850.