« ForrigeFortsett »
These are the only cases in our reports in which the question of nullifying a salvage contract was squarely presented, although there is in the case of Post v. Jones, 19 How. 150, 160 [15: 618, 622], an expression of the court to the effect that "courts of admiralty will enforce contracts made for salvage service and salvage compensation, where the salvor has not taken advantage of his power to make an unreasonable bargain; but they will not tolerate the doctrine that a salvor can take the advantage of his situation and avail himself of the calamities of others to drive a bargain; nor will they permit the performance of a public duty to be turned into a traffic of profit." Indeed, it may be said in this connection that the American and English courts are in entire accord in holding that a contract which the master has been corruptly or recklessly induced to sign will be wholly disregarded. The Theodore, Swab, Adm. 351; The Crus. V, 1 Lush. 583; The Generous, L. R. 2 Adm. & Eccl. 57, 60.
The intimations of this court have been followed, except in very rare instances, by the subordinate courts. Thus, in the case of The Agnes I. Grace, 49 Fed. Rep. 662, and 2 U. S. App. 317, a schooner bound for Port Royal, South Carolina, put into Tybee Roads under stress of weather. She came up on the sands in an exceedingly perilous condition. The ground was treacherous and dangerous, and while lying there she was exposed to the full force of the sea and winds. A towboat company offered its services, and a contract was entered into to pay the sum of $5,000 as salvage. A portion of the cargo, amounting to $7,000, was saved, as well as the *schooner, which was sold for $5,030, probably about one half her value. The contract was sustained. The court put its decision upon the ground that the case could not be considered as belonging to that class "where the master being upon the high seas or an uninhabited coast, at a distance from all other aid, is absolutely helpless and without power to procure assistance other than that offered, and is compelled in consequence to make a hard and inequitable contract. He was within easy reach of Savannah, where, had he desired to assume the risk for his owners, he could have procured lighters and other tugs to render the service."
In the case most frequently cited, The Emulous, 1 Sumn. 207, the parties treated the contract at an end on account of unexpected difficulties, but Mr. Justice Story expressed the opinion that salvage contracts were within control of the court, and that the salvor could not avail himself of the calamities of others to force upon them a contract unjust, oppressive, or exorbitant. In the subsequent case of Bearse v. Three Hundred and Forty Pigs of Copper, 1 Story, 314, Justice Story found that no fixed or definite contract for the services existed, although he had previously remarked that it was "one of the few and excepted cases in which there may be a private contract fixing the rate of salvage, which will be, and ought to be, obligatory between the parties.' We do not think that a salvage contract should be sustained as an exception to the general rule, but rather that it should, prima facie, be enforced, and that it belongs to the defendant to establish the exception. The A. D. Patchin, 1 Blatchf. 414; Harley v. Four Hundred and Sixty-seven Bars Railroad Iron, 1 Sawy. 1; The R. D. Bibber, 33 Fed. Rep. 55; The Wellington, 48 Fed. Rep. 475; The Sir Wm. Armstrong, 53 Fed. Rep. 145; The Alert, 50 Fed. Rep. 721; The Silver Spray's Boilers, Brown, 349.
In Eads v. The H. D. Bacon, Newberry, 274, certain salvors, by the use of their machinery and diving bell worth $20,000, raised a badly sunken steamboat in the Mississippi, valued at $20,000, in twelve hours. It was held that the contracted price of $4,000 was just and reasonable.
The cases in these courts are too numerous for citation, but it is believed that in nearly all of them the distinction is preserved between such contracts as are entered into corruptly, fraudulently, compulsorily, or under a clear mistake of facts, and such as merely involve a bad bargain, or are accompanied with a greater or less amount of labor, difficulty, or danger than was originally expected.
In the earliest of these (1799), Cowell v. The Brothers, Bee, 136, the libellant very properly relinquished his written agreement and applied to the court for such compensation as his services appeared to deserve, although the court expressed the opinion that the contract would have been held void as having been made under circumstances of great distress. To the same effect is Schutz . The Nancy, Bee, 139.
In The J. G. Paint, 1 Ben. 545, an agreement to pay a steamboat $5,000 for towing a vessel worth $8,000, with a cargo of sugar, for twenty-seven hours, was sustained by Judge, subsequently Mr. Justice, Blatchford.
In most of the cases where the contract was held void the facts showed that advantage was taken of an apparently helpless condition to impose upon the master an unconscionable bargain. Brooks v. Stmr. Adirondack, 2 Fed. Rep. 387; The Young America, 20 Fed. Rep. 926; The Don Carlos, 47' Fed. Rep. 746.
It must be admitted that some of these courts have exercised a wide discretion in setting aside these contracts, and have laid down the rule that they are to be closely scrutinized, and will not be upheld when it appears that the price agreed upon by the master is unreasonable or exorbitant. We do not undertake to say that these cases were improperly decided upon their peculiar facts, but we are unable to assent to the general proposition laid down in some of them, that salvage contracts are within the discretion of the court, and will be set aside in all cases where, after the service is performed, the stipulated compensation appears to be unreasonable. If such were the law, contracts for salvage services would be of no practical value, and salvors would be forced to rely upon the liberality of the courts.
Nor is such a contract objectionable, when prudently entered into, *upon the ground that it may result more or less favorably to the parties interested than was anticipated when
the contract was made.
A person may lawfully contract against contingencies; in fact, the whole law of insurance is based upon the principle that, by the payment of a small sum of money, the insured may indemnify himself against the possibility of a greater loss; or, by the expenditure of a trifling amount to-day in the way of premium, his family may receive a much larger sum in case of his subsequent death. If there were ever any doubt with respect to the validity of such contracts it was long since removed by the universal concurrence of the courts, and an enormous business has grown up all over the world upon the faith of their validity. Indeed, nearly every contract for a special undertaking or job is subject to the contingencies of a rise or fall in the price of labor or materials, to the possibility of strikes, fires, storms, floods, etc., which may render it unexpectedly profitable to one party or the other.
agreement depended upon whether they could, with any reasonable probability, affect the services about to be performed. He found that the weather was very tempestuous and the task was made much more difficult for the want of ground tackle, and hence that the agreement was null and void. Per contra, in the case of The Canova, L. R. 1 Adm. & Eccl. 54, he held that, as no danger to property was proved, the agreement would not be set aside by reason of the fact that a great part of the crew of the vessel was dis abled by illness.
In The Phantom, L. R. 1 Adm. & Eccl. 58, an agreement for eight shillings six pence as an award for salvage services was set aside as futile, where it appeared that there was real danger to the salvors in rendering the services. The value of the Phantom was about seven hundred pounds. The case was certainly a very hard one upon the salvors, who appeared to have been ignorant beachWe do not say that, to impugn a salvage men. But it is somewhat difficult to reconcontract, such duress must be shown as cile that with the prior case of The Firefly, would require a court of law to set aside an Swab. Adm. 240, where the court distinctly ordinary contract; but where no such cir- held that it would not set aside a salvage cumstances exist as amount to a moral com- agreement because it seemed to be a hard pulsion, the contract should not be held bad bargain; or that of The Helen and George, simply because the price agreed to be paid Swab. Adm. 368, unless proved to be grossly turned out to be much greater than the serv- exorbitant, or to ha e been obtained by com- ices were actually worth. The presump-pulsion or fraud. It was also held in The tions are in favor of the validity of the con- Waverley, L. R. 3 Adm. & Eccl. 369, that a tract. The Helen and George, Swab. Adm. steamer which contracts to render salvage 368; The Medina, L. R. 2 Prob. Div. 5, al-services for a fixed sum will be held strictly though in passing upon the question of compulsion the fact that the contract was made at sea, or under circumstances demanding immediate action, is an important consideration. If when the contract is made the price agreed to be paid appears to be just and reasonable in view of the value of the property at stake, the danger from which it is to be rescued, the risk to the salvors and the salving property, the time and labor probably necessary to effect the salvage, and the contingency of losing all in case of failure, this sum ought not to be reduced by an unexpect ed success in accomplishing the work, unless the compensation for the work actually done be grossly exorbitant.
to her agreement, and that it is no ground for extra salvage remuneration that the serv ice was prolonged or became more difficult. See also The Jonge Andries, Swab. Adm. 303.
In The Cargo ex Woosung, L. R. 1 Prob.
was sent to her relief from Aden, and the
 While in England there has been some slight fluctuation of opinion, by the great weight of authority, and particularly of the more recent cases, it is held that if the contract has been fairly entered into, with eyes open to all the facts, and no fraud or compulwere accepted. The circumstances sion exists, the mere fact that it is a hard showed a clear case of compulsion. So, too, bargain, or that the service was attended in The Medina, L. R. 1 Prob. Div. 272; S. C. with greater or less difficulty than was antic-L. R. 2 Prob. Div. 5, where the master of a ipated, will not justify setting it aside. The Mulgrave, 2 Hagg. Adm. 77; The True Blue, 2 W. Rob. 176; The Henry, 15 Jur. 183; S. C. 2 Eng. L. & Eq. 564; The Prinz Heinrich, L. R. 13 Prob. Div. 31; The Strathgarry  P. 264.
vessel found passengers of another steamer (550 pilgrims) wrecked on a rock in the Red sea in fine weather, and refused to carry them to Jeddah for a less sum than four thousand pounds, and the master of the wrecked vessel was by such refusal comIn The Kingalock, 1 Spinks, Eccl. & pelled to sign an agreement for that sum, Adm. 263, an agreement was set aside upon and the service was performed without di the ground that when the vessel was taken culty and danger, the agreement was held inin tow the master concealed the fact that she equitable and set aside. The compulsion in had been compelled to slip an anchor and this case was even clearer than in the last. cable, and that her foresail was split. Dr. In The Silesia, L. R. 5 Prob. Div. 177, a Lushington thought that whether the omis-vessel which with her cargo and freight was sion to state those farts would vitiate the valued at £108,000, on a voyage from New 172 U. S.
U. S., BOOK 43.
ment with a passing steamship to pay £500 for half an hour's towage, in order to get his engines to work. The hawser broke immediately after the completion of the agreed time, and the steamship refused to continue the towage. It was held that although no benefit had resulted from the service, the agreement had been duly carried out, and that it was not, under the circumstances, manifestly unfair and unjust, and therefore the stipulated sum must be paid. The case was certainly a hard one, but the court held that, notwithstanding the services lasted but thirty minutes, the whole £500 should be paid.
York to Hamburg, became disabled about 340 miles from Queenstown. The weather was fine and the sea smooth, but after tossing about for four or five days, she hoisted signals of distress. Another steamer bore down upon her bound from Antwerp to Philadelphia, and demanded £20,000 to take her to Queenstown. The master of the Silesia offered £5,000, and finally agreed to pay £15,000, under threat of the other steamer to leave him. The service occupied three days. *The court set aside the agreement as exorbitant, and awarded £7,000. Evidently advantage was taken of the helpless condition of the Silesia, and the agreement was signed under compulsion.
In none of these cases, except, perhaps, In The Prinz Heinrich, L. R. 13 Prob. Div. that of The Phantom, was the agreement set 31, the master of the Prinz Heinrich, which aside except upon proof of corruption, supwas in a position of serious danger, and pression of facts, or circumstances amountashore upon a barbarous and thinly inhab-ing to a compulsion. In the case of The ited coast, entered into a written agreement Phantom the circumstances were peculiar. with the master of the salving steamer, The salvors were seven ignorant longshorewhereby he agreed to pay £200 a day for men, who agreed for a consideration which every day the latter stood by and assisted amounted to but little more than a shilling by towing to get the Prinz Heinrich off, and apiece to undertake the salving of a vessel in the event of her being got off, or coming worth £700. The salvors labored for two off the rocks during the continuance of the hours at great risk of their lives, and the agreement, to pay £2,000 in addition. The court naturally held the consideration to be Prinz Heinrich came off the same day, merely nominal. either owing to the jettison of her cargo or to the towing of the salving steamer. The court held the agreement to be reasonable, and that the salvors were entitled to recover the full £2,200, although the Heinrich was so much damaged that she was subsequently sold for £3,500. The cargo was valued at £14,000. This is a strong case in favor of sustaining the agreement.
In The Mark Lane, L. R. 15 Prob. Div. 135, a steamer becoming disabled in the Atlantic Ocean in fine weather, about 350 miles from Halifax, agreed to pay another steamer £5,000 to tow her to Halifax, and, in case of failing in the attempt to reach there, to pay her for the services rendered. The value of the property saved was somewhat less than £30,000. The contract was set aside, apparently because of the stipulation in the agreement to pay for the services rendered even if they were unsuccessful. The court found the contract to have been signed under compulsion and threat of the salvage steamer to leave her if the master refused.
In The Rialto  P. 175, a steamer in the Atlantic fell in with another which had broken her main shaft. Her master thereupon entered into an agreement that the owner should pay £6,000 for being towed to the nearest port, believing that unless he consented to such terms the salvors would not assist. The distance towed was about 450 miles, and the value of the saved property £38,000. The weather was fine when the contract was made. There was no serious risk to the salvors or their vessel. The court found the contract to be inequitable, that the parties stood on unequal terms, una redased the amount to £3,000.
Under the continental system the courts appear to exercise a wider discretion, and to treat contracts as of no effect when made while the vessel is in danger. Some intimations go so far as to say that they will be disregarded whenever made before the services are rendered. The doctrine of these courts seems to have arisen from the following extract from the fourth article of the Rules of Oleron:
"And yf it were so, that the mayster and the marchauntes have promised to folke, that shuld helpe them to save the shyp and the said goodes, the thyrde parte or half of the said goodes which shuld be saved for the peryll that they be in, the justyce of the country ought well to regarde what payne and what labour they have done in saving them, and after that payne, notwithstanding that promise which the said mayster and the merchauntes shall have made, rewarde them. This is the judgement."
By the German Commercial Code, art. 743, it is enacted that, "when during the danger an agreement has been made as to the amount of salvage or payment for assistance, such agreement may nevertheless be disputed on the plea that the amount agreed upon was excessive, and the reduction of the same to an amount more in accordance to the circumstances of the case may be demanded."
Under the Scandinavian Code, art. 27, the master may, within two months, bring the question of contract before the court, which can refuse the amount if considerably in excess of a reasonable payment for the serv ices performed. Even if it be agreed that the amount be settled by arbitration, the person liable to pay may repudiate the agreement if he does so within fourteen days.
The most ravet case in the English courts is that of The Strathgarry  P. 264. In this case a master of a vessel whose cylin- By the Commercial Code of Holland, art. ders were disabled entered into an agree-568, every agreement or transaction regard
having given up his idea of getting her off with her own anchors, telegraphed his owners and also Lloyds' agent at Galveston, who appear to have sent Mr. Clarke, one of the libellants, down on Sunday evening. He of- fered to undertake the relief of the ship for what the court would allow him. This offer the master declined. About the same time Mr. Sorley, Lloyds' agent, came down to the vessel, saw her situation, remained there two days, and advised the master to invite bids for her relief. He obtained two bids, one for $24,000 and one made by the libellants for $22,000, and on the advice of Sorley and of his owners, Pynam, Bell & Co., of Newcastle-on-Tyne, with whom he kept in constant communication by cable, he accepted libellants' bid, and a contract was entered The French, Belgian, Italian, Spanish, and into, whereby they agreed to float the ElBrazilian Codes have no special provisions frida and place her in a safe anchorage, and upon the subject, and the question of sus- to complete the job within twenty-one days taining or angulling them is rather a ques- from date. The master agreed to pay theretion of fact than of law. for the sum of $22,000, but reserved the  *We have examined the cases cited by coun- right to abandon the ship in lieu of this sel in the Revue Internationale de Droit Mar- amount. At the request of the owners he itime, and find that they are more favor- also inserted a further stipulation that if able to the respondent than the English and the libellants should fail to float the ship and American authorities. In short, they ap- place her in a position of safety within twenpear to pay much less regard to the ty-one days, they should receive no compensanctity of contracts than obtains un-sation whatever for the work performed, or der our system, and we are loath to ac- the labor, tools, or appliances furnished. cept them as expressing the true rule This contract was made at Velasco on Octoupon the subject. Indeed, we have had fre- ber 15. Clarke proceeded at once to get quent occasion to hold that the maritime ready a wrecking outfit, consisting of a tugusages of foreign countries are not obligatory boat and a schooner, with fifteen or sixteen upon us, and will not be respected as author- men, went to the wreck, and spent about two ity, except so far as they are consonant with days planting anchors and connecting cables the well-settled principles of English and from them to the winches of the ship. The American jurisprudence. The John G. Ste- tugboat took no part in the actual relief of vens, 170 Ŭ. S. 113, 126 [42: 969, 975], and the vessel which was effected by the aid of cases cited. the anchors and the steamer's engines, although after the Elfrida was afloat she drifted against the west jetty and the tug hauled her off.
ing the price of assistance or of salvage may be modified or annulled by the judge, if it has been made in the open sea or at the time of stranding. Nevertheless, when the danger is passed, it shall be lawful for both to make regulations or agreements as to the price of assistance or salvage.
By the Commercial Code of Portugal, art. 1608, and by that of the Argentine Republic, 1469, every agreement for salvage made upon the high seas or at the time of stranding, with the captain or other officer, shall be null both with respect to the vessel and to the cargo; but after the risk has terminated the price may be agreed upon, although it will not be binding upon the owners, consignees, or underwriters who have not consented to it.
For the work actually done the stipulated compensation was undoubtedly very large, and if the validity of the contract depended alone upon this consideration, we should have no hesitation in affirming the decree of the circuit court of appeals; but the circumstances under which the contract was made put the case in a very different light. In the first place, the libellants offered to get the vessel off for such salvage as the court should award, but the master declined the proposition, and, acting under the advice of Lloyds' agent and of Moller & Co., the own
The facts in this case are somewhat peculiar, and, in entering into the contract, unusual precautions were taken. On October 5, the Elfrida in entering the river grounded by the stern about mid-channel, her bow drifting over toward the west jetty. Her crew were unable to get her off, either upon that or the following day, when, owing to the sea rising, she was carried over the jetty and a very considerable distance further on to the beach (about 600 feet), where she remained in seven or eight feet of water, gradually working inward and making a bed for herself in the sand, which had a tendency to bank up about her bows. She appears to have been at no time in imminent peril, but her situation could have been hardly without seri-ers' agents at Galveston, invited bids *for the ous danger, unless she was released before a service. This certainly was a very proper heavy storm came on, which might have step upon his part, and there is no evidence broken her up or driven her so far ashore showing any collusion between the bidders to that her rescue would have been impossible. charge an exorbitant sum. The conditions It was shown that in previous years a num- imposed upon the libellants were unusual ber of vessels had gone ashore in this neigh- and somewhat severe. Their ability to get borhood, several of which were lost by bad her off must have depended largely upon the weather coming on. In other cases the diffi- continuance of good weather. Their ability culty of getting them off had been very to get her off within the time limited was largely increased by similar causes. The even more doubtful, and yet under their contestimony shows that while the Elfrida lay tract they were to receive nothing-not even there the wind was at times blowing a gale a quantum meruit-unless they released her with a rough sea, in which the ship strained and put her in a place of safety within twenand bumped heavily. On Saturday the 6th, ty-one days. Further than this, if in getthe day of her final stranding, the master ting her off, or after she had been gotten off,
she proved to be so much damaged that she was not worth the stipulated compensation, the master reserved the right to abandon
UNITED STATES, Piff. in Err.,
We give no weight to the advice of Pynam, Bell & Co., her owners, to enter into the contract, since in the nature of things they could have no personal knowledge of her situation or of the possibility of relieving her; but it shows that her master, though a young man and making his first voyage as a master, acted with commendable prudence. He took no step without the advice of his owners and Argued and Submitted April 21, 1898. Dethat of the underwriters' agent at Galveston, cided December 12, 1898. Mr. Sorley, who was a man over seventy
years of age, perfectly honest, and of large experience in these matters. Sorley visited the vessel, saw her situation, and advised an acceptance of the bid. The value of the ship is variously estimated at from $70,000 to $110.000,, but the sum for which she was insured, £18,000 or $90,000, may be taken as her approximate value. Under the stringent circumstances of this contract, we do not think it could be said that an agreement to pay one quarter of her value if released, could be considered unconscionable or even exorbitant, and, unless the fact that it proved to be exceedingly profitable for the libellants is decisive that it was unreasonable, it ought to be sustained. For the reasons above stated we think that the disproportion of the compensation to the work done is not the sole criterion. Very few cases are presented showing a contract entered into with more care and prudence than this, and we are clear in our opinion that it should be sustained. Had the agree ment been made with less deliberation or pending a peril more imminent our conclu-ance *skidded upon the lands. The defend- sion might have been different. ants were charged as purchasers from Sauve. The amount of timber cut by Sauve was alleged to have been 600,000 feet, and the time of the cutting in the winter of 1887-8 and prior to the first day of March, 1888.
The decree of the Circuit Court of Appeals must therefore be reversed, and the case remanded to the District Court for the Eastern District of Texas with directions to exeeute its original decree.
The case was tried by the court without a jury upon facts stipulated as follows:
CHARLES LOUGHREY et al.
The land grant to the state of Michigan in aid of the construction of railroads, by the act of Congress of June 3, 1856, vested the fee of the lands in the state, subject to a condition subsequent that if the roads were not completed in ten years the lands unsold should revert to the United States.
the act of forfeiture, so as to give the United
The timber cut upon such lands prior to the forfeiture under said act belonged to the state.
The forfeiture of such land grant by the act of Congress of March 2, 1889, did not operate
by relation to revest in the United States title to timber which had been cut prior to
The rule that a mere trespasser cannot defeat the right of the plaintiff in trover by showing a superior title in a third person, without showing himself in privity or connecting himself with such third person, has no application to cases wherein the plaintiff has shown no prima facie right to bring the action.
N ERROR to the United States Circuit
Court of Appeals for the Seventh Circuit to review a judgment of that court affirming a judgment of the United States Circuit Court for the Eastern District of Wisconsin dismissing the complaint in an action brought by the United States, plaintiff, against George Loughrey et al. to recover the value of timber cut from lands in the state of Michigan. Affirmed.
See same case below, 34 U. S. App. 575.
Statement by Mr. Justice Brown: This was an action originally begun by the United States in the circuit court for the eastern district of Wisconsin, to recover the value of timber cut from the north half of the northwest quarter of the northeast quarter of section thirteen, township forty-four north, of range thirty-five west, in the state of Michigan. The complaint charged the cutting of the timber by one Joseph E. Sauve, and that he removed from the lands 80,000 feet of timber so cut, and left the bal
First. The defendants, prior to the first day of March, 1888, cut and removed from the north half (%) of the northwest quarter (NW. 4), and the northwest quarter (NW. 14) of the northeast quarter (NE. 4), and the southeast quarter (SE. 4) of the northeast quarter (NE. 4) of section thirteen (13), in township forty-four (44) north, of range thirty-five (35) west, in the state of Michigan, four hundred thousand (400,000) feet of pine timber, and converted the same to their own use.
Second. That such cutting and taking of said timber by the defendants from said land was not a wilful trespass.
Third. That none of the lands in question were ever owned or held by any party as a homestead.
Fourth. That the value of said timber shall be fixed as follows: That the value of the same upon the land or stumpage, at $2.50 per thousand, board measure; that the value of the same when cut and upon the land, $3.00 per thousand, board measure; that the value of the same when placed in the river was $5.00 per thousand, board measure;