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cretion conferred upon the Commissioner is demonstrated by his answer in this case.

Judgment reversed and case remanded with instructions to reverse the judgment of the Supreme Court of the District of Columbia and direct it to discharge the rule and dismiss the petition.



No. 922. Argued April 16, 17, 1917.—Decided May 7, 1917.

Upon the facts stated in the opinion, Held, that the master and owners of the German Steamship "Kronprinzessin Cecilie" were justified in apprehending that she would be seized as a prize, and her German and other passengers detained, if she completed her voyage to Plymouth and Cherbourg on the eve of the present war; that return to this country before Plymouth was reached was a reasonable and justifiable precaution; and that libelants have no cause of action for failure to deliver their shipments of gold at those ports, although, semble, the risk did not fall within the exception of "arrest and restraint of princes, rulers or people" expressed in their bills of lading. In an ordinary contract of carriage, not made in the expectation that war may intervene before delivery, peril of belligerent capture affords an implied exception to the carrier's undertaking, the contract being silent on the subject.

The court rejects the argument that although a shipowner may give up the voyage to avoid capture after war is declared he is never at liberty to anticipate war; and holds that where war is reasonably and correctly anticipated, liability for non-delivery of freight can not depend upon a nice calculation that delivery might have been made and capture avoided if the voyage had gone on.

238 Fed. Rep. 668, reversed.

1 The docket title of this case is: North German Lloyd, Claimant of the Steamship "Kronprinzessin Cecilie," Petitioner, v. Guaranty Trust Company of New York and National City Bank of New York.

244 U.S.

Argument for Petitioner.

THE case is stated in the opinion.

Mr. Joseph Larocque and Mr. Walter C. Noyes, with whom Mr. Joseph D. Bedle was on the brief, for petitioner:

The case is indistinguishable from The Styria, 186 U. S. 1. In that case and in Nobel's Explosives Co. v. Jenkins (1896), L. R., 2 Q. B. 326, the masters acted under orders from their owners which were just as peremptory as the order received by Captain Polack in this case. In this case as in those the action taken was in accordance with master's independent judgment. In the Styria Case there was no actual restraint or danger, either existing or in futuro.

Justification of the ship's return did not depend on the existence of an actual state of war. The Styria, supra; The Teutonia (1872), L. R., 4 P. C. 171.

If the officers and directors of a corporation which owns a ship owe a duty to passengers, crew and cargo, as well as to the ship itself, to use modern means of communication to inform the master of impending dangers which come to their knowledge, such duty must carry with it a corresponding right. If the duty be to protect the different interests from threatening danger, then, when the duty is performed, liability cannot grow out of the performance of it. Such officers and directors in these days of wireless telegraphy may owe the duty of taking even peremptory action for the protection of all interests. But if they do owe such duty, and exercise their best judgment, they are entitled to the benefit of it. Every consideration which makes the judgment of the master controlling as relating to all interests must operate to give the same effect to the judgment of the owner, when he is required to act for the protection of all.

To exonerate the ship it was not essential that both ship and cargo be exposed to a common peril.

Argument for Petitioner.

244 U.S.

The German cargo owners and the German and Austrian passengers and members of the crew were entitled to just as much consideration as were the Guaranty Trust Company and National City Bank. The Teutonia, supra; The San Roman (1873), L. R., 5 P. C. 301. The uniform course adopted by all German shipowners in issuing warnings to their ships on July 30th and 31st, 1914, is in itself a clear indication that the interruption of the Cecilie's voyage was fully justified.

The order received by wireless from the Imperial Marine Office may, in itself, be considered a restraint. At least, it shows that in the opinion of the German Government, English, French and Russian ports would not be safe for German vessels on and after August 1, 1914, and, therefore, constitutes authoritative and conclusive proof of the wisdom of Captain Polack's course.

The majority of the Circuit Court of Appeals have confused principles which are peculiar to the law of marine insurance with those which are applicable to cases arising under bills of lading.

Policies of insurance are contracts of indemnity. To warrant a recovery under a policy covering arrest and restraint of princes, etc., it is not sufficient to show that the subject of insurance was in danger of loss, or that a loss was actually sustained through fear of a peril insured against, or in attempting to avoid such peril. The peril insured against must have operated directly upon the subject of insurance. See Olivera v. Union Ins. Co., 3 Wheat. 183; Phillips on Insurance, vol. 1, § 1114. This rule is largely aimed at fraudulent and factitious claims of constructive loss. Hadkinson v. Robinson, 3 Bos. & Pul. 388. It is based also on the consideration that the thing insured is not totally destroyed. Ibid.

A bill of lading constitutes the contract between the shipper and carrier, and where the latter undertakes to exercise reasonable care to prevent a loss from an excepted

244 U. S. Argument for the Guaranty Trust Co. of New York.

peril, there is a corresponding assent by the former that the carrier may adopt reasonable precautions to avoid such peril.

It would be an absurdity to hold that the performance of a duty creates a liability for damages.

In the case of a bill of lading, even though the excepted peril be the proximate cause, this will not protect the carrier if the negligence of his servants be a contributing cause, nor if after a loss without such contributory negligence they fail to take reasonable care to minimize the damage. In the latter case the carrier will be responsible for the increased damage although not liable for the original damage. It being the duty of the carrier not to expose the shipper's goods to a restraint, he incurs no liability by performing this duty, even if the precautions adopted involve a deviation from his course.

The true rule is as follows: A reasonable apprehension of capture or other imminent peril justifies a master in deviating from his direct course and taking such steps as a prudent man would take for the purpose of avoiding danger, and in so doing he is entitled to consider the safety of his ship as well as the cargo, and the safety of the belligerent as well as of the neutral cargo. Nobel's Explosives Co. v. Jenkins, supra; Pole v. Cetovich (1860), 9 C. B. (N. S.) 430; The Teutonia (1872), L. R., 4 P. C. 171, 179; The San Roman, supra, p. 306.

The libelants are not entitled to a refund of the prepaid freight.

Mr. J. Parker Kirlin, with whom Mr. Charles R. Hickox was on the brief, for the Guaranty Trust Company of New York:

The Kronprinzessin Cecilie was a common carrier, liable as an insurer for failure to deliver the libelant's gold in England unless excused by the terms of the bill of lading. Liverpool Steam Co. v. Phenix Ins. Co., 129 U. S. 397;

Argument for the Guaranty Trust Co. of New York. 244 U. S.

Propeller Niagara v. Cordes, 21 How. 7, 22; 1 Parson's Ship & Adm., p. 171; 'Moore on Carriers, p. 306.

The failure to complete the voyage and deliver the cargo is not excused by restraint of princes or other exceptions in the bill of lading. The voyage was not abandoned because of "arrest and restraint of princes." The master received specific and definite orders from his owners to turn back. This message was designedly false in its statement of fact, for war had not broken out between Germany and England, France or Russia, or between any two. The master accepted the message as an order and acted accordingly. His testimony shows that unless and until he received the order from the owners he never intended to abandon his voyage. The exception of "enemies" and "arrest and restraint of princes," is found in juxtaposition with other exceptions dealing with loss or damage caused by violence or by uncontrollable forces. It is, of course, to be construed as ejusdem generis with the other excepted causes; that is, it is to be limited to actual arrests and restraints by force, or to steps taken to avoid the reasonable certainty of an arrest and restraint by force, in case the voyage should be continued. In The Styria, 186 U. S. 1, the exception was merely "restraints of princes." Having been introduced into the contract by the shipowners, the exception is to be construed against them. The Caledonia, 157 U. S. 134, 137; Compania v. Brauer, 168 U. S. 104, 118; Carver, Carriage by Sea, 5th ed., § 77.

Recalling the vessel and abandoning the voyage from fear or in the expectation that war might break out is quite a different thing from taking such a step to escape the moral certainty of an arrest and restraint.

An arrest involves an actual seizure by hostile forces. Olivera v. Union Ins. Co., 3 Wheat. 183, 189. A justifiable fear may be equivalent to an actual arrest but only in such cases as Nobel's Explosives Co. v. Jenkins (1896), 2 Q. B. 326, where arrest was a practical certainty. The law in

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