SECTION 3.-LIMITATION OF LIABILITY BY STATUTE

REVISED STATUTES OF THE UNITED STATES.

Sec. 4281. If any shipper of platina, gold, gold dust, silver, bullion, or other precious metals, coins, jewelry, bills of any bank or public body, diamonds, or other precious stones, or any gold or silver in a manufactured or unmanufactured state, watches, clocks, or timepieces of any description, trinkets, orders, notes, or securities for payment of money, stamps, maps, writings, title-deeds, printings, engravings, pictures, gold or silver plate or plated articles, glass, china, silks in a manufactured or unmanufactured state, and whether wrought up or not wrought up with any other material, furs, or lace, or any of them, contained in any parcel, or package, or trunk, shall lade the same as freight or baggage, on any vessel, without at the time of such lading giving to the master, clerk, agent, or owner of such vessel receiving the same a written notice of the true character and value thereof, and having the same entered on the bill of lading therefor, the master and owner of such vessel shall not be liable as carriers thereof in any form or manner; nor shall any such master or owner be liable for any such goods beyond the value and according to the character thereof so notified and entered.59

give notice of claim before the cattle were removed, and that no suit should be sustained unless brought within 40 days after the damage should occur. The stipulation as to making claim was held void under the statute, and that as to the time for suing valid.

59 This section is founded upon Act March 3, 1851, c. 43, § 2, 9 Stat. 635 (U. S. Comp. St. 1901, p. 2942). Compare Consulate of the Sea, c. 212, ante, p. 97, note.

"The liability of the carrier as such was well understood by the framers of the statute. It had long been settled so that no one could mistake it. By force of his public employment he became an insurer of the property intrusted to his care, and liable for its loss, irrespective of the cause, unless from the act of God or the public enemy. But involved in this greater liability and absorbed by it was a lesser liability as bailee for hire; of no consequence while the greater liability existed, but surviving the destruction of that, so that when the carrier ceased to be liable as carrier he yet remained liable as bailee. *** So much and no more than that the section under consideration accomplished, for it distinctly removes the liability as carrier, without touching that as bailee. * **We are further referred to the case

of Hinton v. Dibbin, 2 Adol. & E. (N. S.) 646, in which it was held under a similar statute (1 Wm. IV, c. 68) that the carrier could not be held liable even for gross negligence; but that decision was founded upon an enactment from which the words 'liable as carrier' were conspicuously absent. Finch, J., in Wheeler v. Oceanic Steam Nav. Co., 125 N. Y. 155, 26 N. E. 248, 21 Am. St. Rep. 729 (1891), holding a common carrier by steamship liable for a box of pictures shipped by an artist, without giving notice of their character as provided in the statute, and lost by fault of its servants.

Acc. La Bourgogne, 144 Fed. 781, 75 C. C. A. 647 (1906). For other cases under this section, see 4 Fed. St. Ann. 837.

Sec. 4282. No owner of any vessel shall be liable to answer for or make good to any person any loss or damage which may happen. to any merchandise whatsoever, which shall be shipped, taken in, or put on board any such vessel, by reason or by means of any fire happening to or on board the vessel, unless such fire is caused by the design or neglect of such owner.co

Sec. 4283. The liability of the owner of any vessel, for any embezzlement, loss, or destruction, by any person, of any property, goods, or merchandise, shipped or put on board of such vessel, or for any loss, damage, or injury by collision, or for any act, matter, or thing, lost, damage, or forfeiture, done, occasioned, or incurred, without the privity, or knowledge of such owner or owners, shall in no case exceed the amount or value of the interest of such owner in such vessel, and her freight then pending.

Sec. 4284. Whenever any such embezzlement, loss, or destruction is suffered by several freighters or owners of goods, wares, merchandise, or any property whatever, on the same voyage, and the whole value of the vessel, and her freight for the voyage, is not sufficient to make compensation to each of them, they shall receive compensation from the owner of the vessel in proportion to their respective losses; and for that purpose the freighters and owners of the property, and the owner of the vessel, or any of them, may take the appropriate proceedings in any court, for the purpose of apportioning the sum for which the owner of the vessel may be liable among the parties entitled thereto.

Sec. 4285. It shall be deemed a sufficient compliance on the part of such owner with the requirements of this title relating to his liability for any embezzlement, loss, or destruction of any property, goods, or merchandise, if he shall transfer his interest in such vessel and freight, for the benefit of such claimants, to a trustee, to be appointed by any court of competent jurisdiction, to act as such trustee for the person who may prove to be legally entitled thereto; from and after which transfer all claims and proceedings against the owner shall

cease.

Sec. 4286. The charterer of any vessel, in case he shall man, victual, and navigate such vessel at his own expense, or by his own procurement, shall be deemed the owner of such vessel within the meaning of the provisions of this title relating to the limitation of the liability of the owners of vessels; and such vessel, when so chartered, shall be liable in the same manner as if navigated by the owner thereof.

60 This section is founded upon Act March 3, 1851, c. 43, § 1, 9 Stat. 635 (U. S. Comp. St. 1901, p. 2943). In the cases to which it applies, it relieves an owner not personally at fault from liability for the fault of the officers or crew of his vessel. Walker v. Transportation Co., 3 Wall. 150, 18 L. Ed. 172 (1865). It has been held not to apply to loss of passengers' baggage. The Marine City (D. C.) 6 Fed. 413 (1881). Or to the loss of a horse and vehicle on a ferryboat. The Garden City (D. C.) 26 Fed. 766 (1886). For other cases under this section, see 4 Fed. St. Ann. 838.

Sec. 4289 [as amended 1875, 1886]. The provisions of the seven preceding sections, and of section eighteen of an act entitled “An act to remove certain burdens on the American merchant marine and encourage the American foreign carrying-trade, and for other purposes,' approved June twenty-sixth, eighteen hundred and eighty-four, relating to the limitations of the liability of the owners of vessels, shall apply to all sea-going vessels, and also to all vessels used on lakes or rivers or in inland navigation, including canal-boats, barges, and lighters."1

Act June 26, 1884, c. 121, § 18, 23 Stat. 57 (U. S. Comp. St. 1901, p. 2945). That the individual liability of a shipowner, shall be limited to the proportion of any or all debts and liabilities that his individual share of the vessel bears to the whole; and the aggregate liabilities of all the owners of a vessel on account of the same shall not exceed the value of such vessels and freight pending: Provided, that this provision shall not affect the liability of any owner incurred previous to the passage of this act, nor prevent any claimant from joining all the owners in one action; nor shall the same apply to wages due to persons employed by said shipowners.

THE CITY OF NORWICH.

(Supreme Court of the United States, 1886. 118 U. S. 468, 6 Sup. Ct. 1150, 30 L. Ed. 134.)

The steamboat City of Norwich, owned by the Norwich & New York Transportation Company, collided with the schooner Van Vliet in Long Island Sound in April, 1866. The schooner was sunk. The steamboat was set on fire by the collision, and subsequently sank with her cargo. The owners of the schooner sued the owner of the steamboat in the District Court of the United States for the District of Connecticut, and eventually obtained a decree for about $22,000. The steamboat was raised, taken to Long Island, and repaired. She was then libeled in rem by owners of her lost cargo in the District Court of the United States for the Eastern District of New York, within whose territorial jurisdiction she was. Thereupon the owner of the steamboat, for the purpose of obtaining the benefit of the limited liability act of 1851 (Rev. St. §§ 4283-4287 [U. S. Comp. St. 1901, pp. 2943, 2944]), took proceedings in the Connecticut court to limit the damages recoverable from him in the suit there pending to that percentage of the vessel's value which the liability established in that suit bore to all the owner's liabilities arising out of the collision. On appeal to the Supreme Court of the United States that court held that the Connecticut court had no right to give relief in the form in

61 These sections are founded upon Act March 3, 1851, c. 43, §§ 3, 4, 5, 7, 9 Stat. 635, 636 (U. S. Comp. St. 1901, pp. 2943-2945).

which it was asked to do so. Norwich Co. v. Wright, 13 Wall. 104, 20 L. Ed. 585 (1871). It was suggested, however, that the owner might obtain the benefit of the limited liability act by appropriate proceedings in the District Court in New York which had possession of the vessel or of security given when she was released from arrest. The Supreme Court also promulgated rules of practice prescribing the nature and course of such proceedings. Rules of Practice in Admiralty, Nos. 54-57, 13 Wall. xii, xiii; Hughes on Admiralty, 462464.

In conformity with these rules, the owner of the steamboat filed a petition in the District Court of the United States for the Eastern District of New York. The petition prayed the court to cause an appraisal to be made of the value of the petitioner's interest in the vessel and her pending freight, and, upon petitioner's paying into court or giving security for the value as appraised, to cite all persons having claims arising out of the collision to appear and prove their claims, and to enjoin them from prosecuting their demands in any other proceeding.

The court entertained the petition, and held that the value of the steamboat intended by the statute was, in this case, the value as the vessel lay after sinking, and was not her value before the collision, nor her value immediately after the collision and before she was damaged by fire, nor her value after she had been raised. The court also held that the liability of the owner was not increased by the fact that he was insured against his vessel's loss by fire and had been paid over $49,000 as insurance money. It further held that since no freight money had been paid or earned the owner was under no liability to damage claimants by reason of pending freight. The value of the steamboat was fixed at $2,500. The petitioner paid this sum into court, and a decree was made apportioning it among the persons who had proved claims in that proceeding, and discharging petitioner from further liability for the collision. On appeal to the Circuit Court the decree was affirmed. The Circuit Court found that the collision, though caused by negligence of the steamboat's officers or hands, was without design, neglect, privity, or knowledge of her owner. From the decree of affirmance, owners of cargo appeal to the Supreme Court.

BRADLEY, J.62 * * * The next question to be considered is, at what time ought the value of the vessel and her pending freight to be taken, in fixing the amount of her owners' liability? Ought it to be taken as it was immediately before the collision, or afterwards? And if afterwards, at what time afterwards?

The first question has been repeatedly answered by the decisions of this court. We held in Norwich Co. v. Wright, and have held and

62 The statement of facts has been rewritten. Parts of the opinion are omitted.

decided in many cases since, that the act of Congress adopted the rule of the maritime law as contradistinguished from that of the English. law on this subject; 63 and that the value of the vessel and freight after, and not before, the collision is to be taken. But at what precise. time after the collision this value should be taken has not been fully determined so as to establish a general rule on the subject. That is a question which deserves some consideration. In the case of The Scotland, 105 U. S. 24, 26 L. Ed. 1001, the collision occurred opposite Fire Island Light, and the steamer being much injured, put back in order, if possible, to return to New York; but was unable to get further than the middle ground outside and south of Sandy Hook, where she sunk, and nothing was saved but a few strippings, taken from her before she went down. We held that these strippings were all of the ship that could be valued, although she had run 30 or 40 miles after the collision. The value was taken, not as it was, or as it might have been supposed to be, immediately after the collision, but as it was after the effects of the collision were fully developed in the sinking of the ship.

An examination of the statute will afford light on this subject. Section 4283 declares that the liability of the owner of any vessel (for various acts and things mentioned) shall "in no case" exceed the value of his interest in the vessel and her freight then pending. When it says "in no case," does it mean that for each case of "embezzlement, loss, destruction, collision," etc., happening during the whole voyage, his liability may extend to the value of his whole interest in the vessel? Twenty cases might occur in the course of a voyage, and all at different times. Does not the provision made in section 4284, for compensation pro rata to each party injured, apply to all cases of loss and damage happening during the entire voyage-happening, that is, by the fault of the master or crew, and without the privity or knowledge of the owner? Pending freight is of no value to the shipowner until it is earned, and it is not earned, if earned at all, until the conclusion of the voyage. Does this not show that every "case" in which the principle of limited liability is to be applied means every voyage? We think it does. It seems to us that the fair inference to be drawn from section 4283 is that the voyage defines the limits and boundary of the casus or case to which the law is to be applied.

63 "As explained in The Lottawanna, 21 Wall. 558, 22 L. Ed. 654 (1874), the maritime law is only so far operative in any country as it is adopted by the laws and usages of that country; and this particular rule of the maritime law had never been adopted in this country until it was enacted by statute." Bradley, J., in The Scotland, 105 U. S. 24, 26 L. Ed. 1001 (1881).

The English statute (St. 53 Geo. III. c. 159, s. 1) limited liability to value of ship and freight, and was interpreted to mean value immediately before the cause of action arose. Wilson v. Dickson, 2 B. & Ald. 2 (1818). By English Merchant Shipping Act 1894, § 503, a shipowner's liability is limited for personal injury or loss of life to £15 for every ton of his ship's tonnage, and for injury to property to £8 for every ton, irrespective of the value of the ship.