The opinion of the court was delivered by: Blatchford, J.
Thos. J. Semmes and Richard De Gray, for appellants.
P. Phillips, Jas. McConnell, and W. Hallett Phillips, for appellees.
This is a libel in admiralty against the cargo of the ship Tornado, brought by the master and owners of that vessel, to recover freight money. The district court and, on appeal, the circuit court, dismissed the libel. The libelants have appealed to this court. The material facts found by the circuit court are these:
On the twenty-fourth of February, 1878, the ship, while moored at the wharf in New Orleans, and bound on a voyage to Liverpool, England, and before she had broken ground for said voyage, was discovered to be on fire in her hold. Her master had given bills of lading for the transportation from New Orleans to Liverpool, with the exceptions usual in bills of lading, of 5,195 bales of cotton, of which 5,008 had been put on board, 164 were on the levee, and 23 had not reached the levee. Water was pumped into the ship to extinguish the fire, and on the 26th, near 6 o'clock P. M., being filled with water, she sank to the bottom of the river along-side of the wharf, a part of her bulwarks remaining above water. While so resting upon the bottom of the river, the ship, cargo, and freight were, on the 27th, libeled in the district court, for salvage, by the New Harbor Protection Company, and about 2 o'clock P. M. of that day the marshal, by virtue of a warrant of seizure issued by said court on said lible, took possession of the ship and cargo. On the 28th, about noon, the ship was pumped out and raised along-side of the wharf, and the discharge of the cargo on board was commenced, all of it being damaged by water, and some of it by fire, 336 bales having been removed by the salvors in an undamaged condition before the ship sank, but after the fire was discovered; but salvage was claimed and allowed on the entire cargo. On the same day, the proctor for the salvors filed in the district court a motion in writing, suggesting that the whole cargo then being discharged from the ship was greatly damaged by water, and some of it by fire and water, and would in all probability have ultimately to be sold, being in an unfit condition to be sent to its destination; and an order of the court was thereupon made directing a sale of the cargo by the marshal upon the levee as it came out of the ship, on two days' advertisement, in such lots as might accumulate from day to day. On the same day an application was made to the court by the master of the ship, in which he represented that he was desirous and entitled to bond the ship and cargo, and asked for a rule upon the libelant to show cause on the next day, March 1st, why the order to sell the cargo should not be rescinded, and the master be allowed to bond the cargo.
On March 1st the rule came on for hearing. The proctor for the salvors, and counsel representing the insurers of the cargo, appeared and resisted the rescinding of the order of sale, and counsel appeared for the master, who filed a formal claim to the ship and cargo. On the trial of the rule witnesses were examined orally before the judge, among them various representatives of the underwriters on the cargo, who were called as witnesses by the proctor for the salvors, and who testified that if their interest were to be consulted they preferred that the cotton should be sold by the marshal as it came out of the ship, and that the master should not be permitted to bond the cotton. The counsel for the insurers of the cargo then asked leave to be heard on their behalf. To this the counsel for the master and claimant objected, and insisted that counsel for the underwriters on the cargo could not be heard until after the proof of abandonment to them by the owners of the cargo and acceptance of the abandonment. Thereupon, Mr. Palfrey, president of the Factors' & Traders' Insurance Company of New Orleans, which was one of the companies represented by said counsel, and one of the witnesses who had been called to the stand as above stated, was recalled by said counsel, and testified that so far as his company was concerned the loss on the cargo had been paid or ordered to be paid, and said company had become the owner of the cotton insured by it, and abandonment thereof had been made and accepted by his company. After this, said counsel was allowed to and did make an oral argument in behalf of the underwriters, in opposition to the motion to rescind the order to sell, which had been obtained by the salvors, but no pleadings were filed in behalf of the underwriters. Upon the trial of the rule evidence was also taken, by order of the court, in relation to the condition of the cargo, and whether the same was or was not a total loss.
On March 5th, and before the district court had made any decision or order on the rule to rescind the order for the sale of the cotton, a proctor representing underwriters at Lloyds, by leave of the court, filed an intervention for the interest of the insurers of the freight on the cargo, in which it was prayed that the order for the sale of the cargo be rescinded. This intervention was supported by affidavits filed by the intervenors and by a brief of the proctor. Afterwards, on March 6th, after consideration of the rule taken by the master of the ship to rescind the order of sale, and of the evidence and arguments thereon, and of the last-named intervention, and of the affidavits and brief submitted therewith, the court ordered that the master be allowed to bond the ship and such of the cotton then stored in the levee steam cotton-press as was in good order, amounting to 523 bales, and that the remainder of the cargo on board the ship or upon the levee, which was more or less damaged, be sold by the marshal after three days' notice, and all questions of freight were reserved by the court, and the court appointed a trinity master to advise and assist in making sale of the cotton. On the nineteenth of March the underwriters filed their claim, claiming all of the cargo, and procured an order from the judge of the district court to be entered on their claim, suspending the right given to the master on the sixth of March, to bond such of the cotton as was stored in the levee cotton-press, to-wit, about 500 bales, until the further order of the court. On March 26th, the master not having bonded the cotton a rule was taken and duly served on him to show cause why the order of March 6th, so far as it allowed him to bond a portion of the cotton, should not be rescinded, and the movers of the rule, the insurers of the cargo, be allowed to bond the same. The rule was heard on March 27th, the movers of the rule and the master being represented by their respective counsel, and was by the court made absolute, without opposition, and the order allowing the master to bond said portion of the cargo was rescinded, and the movers of the rule were allowed to bond the same.
On the thirtieth of March the present libel was filed. The unsold cargo and the proceeds of that which had been sold were then in the custody of the marshal, in the suit for salvage. The libel recites the proceedings above mentioned, and alleges that the cotton might have been picked, dried, and rebaled, and sent to its destination, and freight have been earned thereon, but that the application of the master to bond the cargo was refused, owing to the opposition of the libelant for salvage, and especially to the opposition of the underwriters on the cargo; and that, under the contract of carriage, it was the right as well as the duty and the desire of the libelants to pick, dry, and rebale so much of the cotton as might require it, and which could easily have been done, and to carry it to its destination and earn the freight money for carrying it, which they had been unable to do because they had been denied the right to bond it, owing to the opposition of the libelant for salvage and of the underwriters on the cargo, resulting in the taking away of the cargo entirely from the master; in consequence of which the entire freight money agreed on became due, as well as money paid by the libelants for compressing and stowing the cargo in the vessel, and other expenses incident thereto, and for railroad charges; for all of which the libel claims a lien on the cargo and on the proceeds of sale.
The circuit court found the following further facts:
The libelants paid for compressing the cargo before it was put on board, and for stowing it on board, and other expenses incident thereto, $14,278.26. The gross freight on the cargo, had it been delivered at its destination in Liverpool, as required by the bills of lading, would have been £4,169 13s. 1d. Of the cotton, 523 bales were in an undamaged and sound condition, being the 23, the 164, and the 336 before mentioned. In consequence of the fire, and as a result thereof, the ship was so badly damaged that the cost of her repairs would exceed her value when repaired, and she was unseaworthy and incapable of carrying freight. The 523 bales were bonded by the underwriters, and were appraised at the sum of $19,100. The gross proceeds of the sale of the damaged cotton amounted to $116,000. The purchaser at the marshal's sale shipped to northern states, in the condition in which it came from the ship, 1,185 bales of the damaged cotton; and 2,896 bales more were picked, dried, rebaled, and shipped, part to Liverpool and the rest to Philadelphia. All the damaged cotton taken from the ship was unmerchantable cotton, even after it had been picked, dried, and rebaled; that is, it could not be used for making cotton cloth, but could only be used for making felt hats, paper, wadding, and such like articles, having lost, by the submersion and drying, a large part of its natural oil, its fiber being injured and its weight reduced.
On the facts so found the circuit court held that the libelants had no lien on the cargo or its proceeds for freight, or for money paid by them for compressing and stowing the cargo, and dismissed the libel.
The libelants seek to apply to the present case the principle applied where a voyage partly performed is interrupted by a disaster to the ship, namely, that the ship-owner has a lien on the cargo for the earning of the freight, and so has a right to carry the cargo forward by his vessel or some other conveyance, and deliver it and receive his full freight. As in the case of a disaster to the ship in the course of a voyage the whole freight is payable if, by the fault of the owner of the cargo, the master is prevented from forwarding the cargo from an intermediate port to its destination, it is contended in the present case that the libelants have a right to recover the whole agreed freight, because they had a right to send the cargo to Liverpool and earn full freight, and were prevented from doing so by the action of the underwriters, who became, by abandonment, the owners of the cargo. It is also contended that the owners had a right to repair the ship, even though the cost of repairing would exceed her value when repaired.
The law in regard to the respective rights and liabilities of shipper and ship-owner, where cargo has been carried for a part of a voyage, is nowhere better expressed than by Lord ELLENBOROUGH in Hunter v. Prinsep, 10 East, 378, 394:
'The ship-owners undertake that they will carry the goods to the place of destination, unless prevented by the dangers of the seas, or other unavoidable casualties; and the freighter undertakes that if the goods be delivered at the place of their destination he will pay the stipulated freight; but it was only in that event, viz., of their delivery at the place of destination, that he, the freighter, engages to pay anything. If the ship be disabled from completing her voyage, the ship-owner may still entitle himself to the whole freight by forwarding the goods by some other means to the place of destination; but he has no right to any freight if they be not so forwarded, unless the forwarding them be dispensed with, or unless there be some new bargain upon this subject. If the ship-owner will not forward them, the freighter is entitled to them without paying anything. One party, therefore, if he forward them, or be prevented or discharged from so doing, is entitled to his whole freight; and the other, if there be a refusal to forward them, is entitled to have them without paying any freight at all. The general property in the goods is in the freighter; the ship-owner has no right to withhold the possession from him, unless he has either earned his freight or is going on to earn it. If no freight be earned and he decline proceeding to earn any, the freighter has a right to the possession.'
These remarks were made in regard to a voyage partly performed, and interrupted by a disaster, where freight money was claimed pro rata itineris peracti. But no case can be found in which freight money has been allowed, where the voyage was not commenced, and the ship was, by a disaster for which the shipper was not at all responsible, put ...