White v. Upper Hudson Stone Co.

248 F. 893, 160 C.C.A. 651, 1917 U.S. App. LEXIS 1296

• Court: Court of Appeals for the Second Circuit
• Decided: December 11, 1917
• Docket: Nos. 58, 59
• Status: Published

Opinion

HOUGH, Circuit Judge

(after stating the facts as above). [1] Since the relation between Bleakley, the scow owner, and the Upper Hudson Company, as charterer, was exactly that so recently restated by this court in Hastorf v. F. R. Long, etc., Co., 239 Fed. 852, 152 C. C. A. 638, the charterer was prima facie responsible for any failure to return the boat in good order reasonable wear excepted. The obligation was that of a bailee, and liability was not discharged by showing that the vessel had been intrusted to the care of another, and injured either by that other’s negligence or while in such other’s charge. Gannon v. Consolidated Ice Co., 91 Fed. 539, 33 C. C. A. 662. Therefore the negligence of Gahagan and the Ono, or of either, was only important because proof thereof would enable the Upper Hudson Company to retrieve from them the loss to which it was subjected by the nature oí its contract with Bleakley.

We find it uncertain on the evidence whether there ever was any agreement by Gahagan to tow the respondent’s barges all the way into Long Beach inlet or harbor. It may be that he, in the beginning of the work, employed the Ono, or sublet or farmed out to that boat some portion of his towing contract. But before the accident herein a course of business had been established by which both Gahagan and the Ono’s owner dealt directly with the Upper Hudson Company; each worked independently for that company; each was a principal. From this finding of fact, it results that there is no evidence of negligence against Gahagan.

[2] As to the Olio, we discover no escape from liability. She assumed the ordinary obligation of a towing vessel; inter alia, to know the recognized channel, the tides, the draft of the tow, and with reasonable skill to judge the weather. While in her care the U. H. 44 pounded and stranded, either because her draft was too great for the bar, or the swell was such that even at highest tide she pounded when in the trough. No matter which story is true, the Olio is liable. If the water was insufficient when calm, her master inexcusably misjudged the tide; if the swell was such as to let the tow pound, lie ought to have perceived that such would be the case, for it was daylight and fine weather, and there was no necessity of going over the bar on that particular tide. What was done was negligence under any state of facts suggested. The Eli B. Conine, 233 Fed. 987, 147 C. C. A. 661.

[3 j These findings leave the Upper Hudson Company to pay whatever cannot be recovered from the Ono, and require consideration of the contention that these libelants, who may be regarded as the scow’s insurers, cannot recover from the Upper Hudson Company, because that company was itself insured against the very loss and damage complained of by (in effect) the libelants themselves.

Whether one party insures another is primarily a question of fact, and, since contracts of insurance are commonly (as here) in writing, the content and purport of the writings must be first considered to ascertain even the intentions of the parties. The policy and rider in evidence do not assist respondent’s contention. The policy insures Bleakley “as interest may appear,” and the rider is a part of the policy, not extending the nature of the assumed risk, nor on its face varying the parties in interest, but only widening the geographical limits within which the contract is to operate.

Doubtless a charterer has an insurable interest in the chartered vessel, and it is not legally impossible that such interest might for some purposes be covered by or in what is ordinarily the owner’s policy. Hagan v. Scottish Union, etc., Co., 186 U. S. 423, 22 Sup. Ct. 862, 46 L. Ed. 1229. In this case, however, the Upper Hudson Company must affirmatively prove (having pleaded the defense as new matter) that it was itself the insured on the voyage to Long Beach, and do so by means other than the written contract. The only evidence produced is the fact that respondent procured and paid for the rider; i. e., a privilege to take the boat beyond harbor limits without vitiating what Bleakley had paid for. •'But this was in plain pursuance of the contract with Bleakley; he never agreed to let his boat go outside the harbor with his interest uninsured, and the reasonable inference from the testimony is that the charterer agreed to keep Bleakley insured if the boat was sent outside.

It results that there was no such agreement between owner and charterer as is alleged. Whether, therefore, had such agreement been made, it would have availed against the insurer, who certainly was no party to it, is a question that need not be considered.¹

The finding of fault in the Ono renders it impossible to give her salvage, or any award in the nature thereof. All the services and expenses shown were rendered necessary by her negligence, and she was and is liable for that and more.

For these reasons, it is ordered that the decree in Bay Dredging, etc., Co. v. Upper Hudson Stone Co. et al. be affirmed, with one bill of costs, and the decree in White et al. v. Upper Hudson Stone Co. be reversed, and the case remanded, with directions to enter decree in favor of libelants against the Upper Hudson Stone Company and the motorboat Ono, execution to issue against the latter in the first instance, and said Stone Company to respond for any balance not collected by execution, said decree to carry costs in both courts. As to Gahagan, let the libel and petition be dismissed, with costs in both courts against the impleading respondent.

1 The Sydney (C. C.) 27 Fed. 11) (appeal dismissed 139 U. S. 332, 11 Sup. Ct. 620, 36 L. Ed. 177), is in its fae.¡: nearer this case than any other reported litigation. As to the question suggested, but not discussed, see Boston Fruit Co. v. British, etc., Co., 11 Commercial Cases, 169. It may be noted that, to protect the bailee, the insurance would have had to cover, not only his interest in the vessel, but his negligence in caring for her — something as to which there is no proof at all.