United States v. Tanker Lake George

123 F. Supp. 216, 1954 U.S. Dist. LEXIS 2990
CourtDistrict Court, D. Delaware
DecidedJuly 22, 1954
DocketNo. 1701
StatusPublished
Cited by3 cases

This text of 123 F. Supp. 216 (United States v. Tanker Lake George) is published on Counsel Stack Legal Research, covering District Court, D. Delaware primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
United States v. Tanker Lake George, 123 F. Supp. 216, 1954 U.S. Dist. LEXIS 2990 (D. Del. 1954).

Opinion

LEAHY, Chief Judge.

The United States filed a libel of information for forfeiture of the steam tanker Lake George. Four separate causes of forfeiture were stated. The first three, based on alleged violations of ship registry statutes, are not at this time involved here. The Fourth Cause of Forfeiture charges violation of §§ 2 and 9 of the Shipping Act of 1916, as amended, 46 U.S.C.A. §§ 802 and 808. United States Petroleum Carriers, Inc., a Delaware corporation (designated as Claimant), filed a special claim as owner of the vessel. Subsequently, Claimant filed exceptions to the Fourth Cause in the libel for failure to state a cause of forfeiture or any claim on which such relief could be granted. Comparable to a motion to dismiss, the exceptions admit for present purposes the well-pleaded allegations of fact in the libel. They are these:

A type T-2 tanker, The Lake George was built for the Maritime Commission1 in 1943 and was registered as a merchant vessel of the United States. It was later offered for sale by the Maritime Commission as a surplus war-built vessel under the Ship Sales Act of March 8, 1946, 60 Stat. 41, 50 U.S.C.A.Appendix, §§ 1735-1746. This statute gave purchase preference to United States citizens, adopting the definition thereof in § 2 of the Shipping Act of 1916, as amended, 46 U.S. C.A. § 802. In September 1947, Claimant made formal application to the Commission to buy several surplus vessels, representing itself as a citizen of the United States. The representation was “contrary to the facts” in that Claimant was “under the control of aliens” and accordingly “did not qualify as a ‘citizen’ corporation within the meaning of the Shipping Act of 1916, as amended (46 U.S.C. § 802)”. Acting on the misrepresentation in the application and other information, the Commission sold four T-2 tankers to Claimant including The Lake [218]*218George, title passing about March 14, 1948. Thus, for purposes of testing the legal basis of the libel’s Fourth Cause of Forfeiture, it is assumed The Lake George was a vessel owned and documented by the United States which was sold by the Maritime Commission to an alien corporation under the Ship Sales Act of 1946 upon a misrepresentation of citizenship.

The Government has chosen to seek forfeiture of the vessel rather than rescission of the sale or damages for misrepresentation. Under general principles of the law of contracts, rescission would restore the vessel to the Maritime Commission but only upon the return of the purchase price to Claimant. A civil suit premised on injury to the Government from the alleged misrepresentations could result in substantial money damages assessed against Claimant. Penal damages in a criminal action under 18 U.S.C. § 1001 or 46 U.S.C.A. § 839, for example, could result in a fine of $10,000 or $5,000 respectively.

§ 9 of the Shipping Act of 1916 2 is cited as the statutory authority or justification for forfeiture, not the 1946 Act under which the sale to Claimant was made. Challenging the applicability of the forfeiture provisions of the 1916 Act, Claimant urges the occupancy of the field by the later Act and its sole pertinency to the sale, its integration and its absence to provide a remedy in terms of forfeiture. The construction I ascribe to § 9 eliminates the necessity of ruling upon Claimant’s contention. I assume, without deciding, § 9 controls.3

Libellant relies on the last clause in § 9’s third paragraph — “or the last documentation of which was under the laws of the United States” — as fully describing one category of vessels statutorily subject to forfeiture and independent of other categories previously described in the paragraph; and, under this disassoeiation of the last clause from the immediately preceding language, the citizenship of the vessel’s owner-seller is immaterial.

Libellant emphasizes this contention obviates a decision as to whether the United States, as owner of The Lake George, is a “citizen of the United States” for purposes of the application of the 1916 Act. The argument for isolation of the “last documentation” clause has plausible foundation. Punctuation, the use of the disjunctive, and prior Acts furnish some support for this view. A comma precedes and sets off the clause. The disjunctive “or” introduces it. From the first Act in 1916, 39 Stat. 730, until the 1938 Act, 52 Stat. 964,4 which is now in force, similar, though not identical, clauses have variously appeared to stand as an alternative and independent classification of subject vessels. Yet, though full rein be given the Government’s arguments, they are halted short of persua-: sion by the wording of the clause, the legislative intent expressed during consideration of the 1938 amendment, and the sense of the statute. In considering these counter-arguments, the Government’s assumption of the separateness or independence of the last clause of § 9’s third paragraph will be accepted.

[219]*219Inclusion of the word “last” to describe’ which documentation subjects a vessel to forfeiture is one indicia of the scope expressly intended by the Congress to be encompassed by the clause. “Being or remaining after all the other documentations in time or order of succession” is the meaning ascribed this word in the libellant’s interpretation; it is read synonymously with “most recent” in the sense of “last but continuing documentation”. Claimant advances “next before the present”, “a documentation which was but has since ended” and “presently undocumented” as the intended meaning in context of “last documentation”. Each of the profferred variations has the imprimatur of Webster’s New International. However, Claimant’s version, I conclude, accurately reflects the intent of the Congress as is apparent from the purpose of the 1938 amendment and legislative reports.

The “last documentation” clause was added to § 9 in 1938 to avoid a result under the prior law as was obtained in The Helori, D.C.W.D.Wash., 24 F.2d 710. In that case, the Government'sought forfeiture of a vessel sold by a citizen corporation to a non-citizen corporation without Shipping Board approval. The vessel, at one time documented, was acquired by the U. S. Navy which surrendered the documentation. Thereafter, the Navy sold the vessel undocumented to a California corporation, which without documenting it resold it to a non-citizen. Thus, at the time of the alleged illegal sale, the vessel, although owned by a citizen, was undocumented. § 9 did not then include either the clause “owned in whole or in part by a citizen of the United States”, or the clause “the last documentation of which was under the laws of the United States.”5

The Court stated § 9 applied only to á documented vessel and “the Helori” was not subject to forfeiture under that section because it was undocumented at the time of its sale to the non-citizen. At page 712 of 24 F.2d: “The vessel, being sold by the United States through the Secretary of the Navy, and delivered to the purchaser, the California corporation, not documented, and the sale by the California corporation to the Canadian corporation of the nondocumented vessel, was without the provisions of section 8146-(e). (46 U.S.C.A. § 808.)” (Emphasis added.)

The 1938 amendment was initiated by H.R.

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Related

RC Craig Limited v. Ships of Sea Incorporated
345 F. Supp. 1066 (S.D. Georgia, 1972)
United States v. The Lake George
224 F.2d 117 (Third Circuit, 1955)

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Bluebook (online)
123 F. Supp. 216, 1954 U.S. Dist. LEXIS 2990, Counsel Stack Legal Research, https://law.counselstack.com/opinion/united-states-v-tanker-lake-george-ded-1954.