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z MARITIME LAW. LIEN FOR SUPPLIFS AND REPAIRS—DEBT CON- TRACTED BY SHIP OWNER—PRESUMPTION OF OWNER'S CREDIT—PREVIOUS SALE BY SHERIFF— DISCHARGE OF LIEN. United States District Court, Eastern Dis- trict of Pennsylvania. Delaware River Iron Engine Works vs. The Mary Morgan. 1. Liens are implied for necessary repairs and supplies wheie the debt is contracted by the master in a foreign port. The doctrine of implied lien for supplies and repaire has not been extended to debts contracted by the owner, saving perhaps ‘in exceptional cases, where it appers that the circum- stance are such as to forbid absolutely the presumption that the debt was contracted withsut a pledge of the vessel. 2. The steamer Mary Morgan was furnished with repairs and supplies in Ches- F ter, Pa. She belonged toa New Jersey cor- poration, but her owner was engaged ip business in Chester, where the principal cor- porate officers resided and where the meet- ings of the corporation were held; the ves- sel was also enrolled in the collector’s office in Philadelphia and visited Chester daily. The debt was contracted by the owners. Held, that whether the vessel should be re- Ship Building & | he Marine Revd: plies, to debts contracted by the master. The rule was so stated uniformly, until within arecent period. Conklin, Vol. 1, page 80, after defining it in similar terms, says, “To guaid against possible misapprehension it is proper to say, that no lien is ever implied from contracts of the owner. It is only the contracts which the masters enters into, in his character of master, that specially | bind the ship, or affect it by way of lien or privilege, in favor of the creditor. When the owner is present, acting on his own be- half as such, the contract is presumed to be made with him, or on his ordinary responsi- bility, without a view to the vessel.’? In the St. Jago de Cuba, 9 Wheat. 110, the court says: ‘‘The whole object of giving admiralty process and priority of payment to privileged creditors, isto furnish wings and legs to get home for the benefit cf all concerned, Itis not in the power of any one but the ship masier, not the owner himself, to give these implied liens on the vessel, The law marine attaches the power of pledging or subjecting the vessel to ma- terial men, to the office of ship master. The necessities of commerce require that when garded as foreign or not,—which was not decided,—there was nothing in the situation to demand a pledge of the vessel, and con- sequently nothing to repel] the presumption of credit to the owners alone. The vessel was not, therefore, subject to a lien for the supplies. 8. Previous to this suit, a note had been given for the price of the repairs rendered by. the libelant, and upon this note judgment had been obtained in a state court, and the vessel had been sold by the sheriff on an execution. Held, that even if the vessel, in-view vt the above mentioned facts, had been subject to a lien, it was discharged by the sale of the boat. he libel was therefore dismissed. Butler, J. This case is one of unusual interest. The vessel belonged to the Bridgeport Steamboat Company, incorporated under the laws of New Jersey. She was enrolled in the collector’s office at Philadelphia, and ran between Phila- delphia and Wilmington, Del., touching at Bridgeport, N. J.,and Chester and Marcus Hook, Penn. The debt was contracted for alteration, re- pairs, and supplies, obtained to fit her for a voyage, or voyages, from Philadelphia to ‘Savannah and back, in the winter of 1885, while navigation on the Delaware was in- terfered with by ice. - The debt was contracted by the president ot the company, who, with the treasurer, and secretary resided at Chester, where the ork was done and the supplies furnished. ‘company held all its meetings (ex- t annual meetings of stockholders) at Chester; and so far as appears, transacted, the principal part, if not a)l, of its business in this state. c ‘A note was given for the amount due, on which judgment was obtained in the com- mon pleas of Delaware country, July 9th, 1885. Under an execution issued on this judgement, avd another issued by. Mr. Bickley, the vessel was sold by the sheriff, for $5,000. The execution of Bickley, who became the purchaser, was before the libel- ant’s,in point of time; and whether the latter wil] be paid from the proceeds of sale is undecided. ‘The libelant claims payment, and is now contesting the question with Bickley, in the common pleas of Delaware county. Has the libelant alien? The subject of implied lien, in the ad- miralty, is often a difficult and perplexing one. The principals upon which the dovtrine rests are well defined, and easily understood. ‘Their application, however, = has been such as to create uncertainty and confusion. Impressed with the disad- vantages attending such liens,—unregistered and secret,—the courts started out with a cautious and sparing application of the doctrine, limiting its operation to cases, (or rather classes of cases,) where the circum- stances not only justify, but demand the implication of a pledge. ‘ More recently, in apparent torgetfulnes or disregard of the reasons on which this limitation was founded, its operation has been extended in some directions and such a disposition shown to extend it-in others, that the courts bave come to hesitate, and occasionally disagree, respecting the true line of limitation. Liens are implied for necessary repairs, and supplies, where the debt is contracted by the masterinaforeign port. The im- plication is tounded*eon the sbip’s situation and presumed necessities. The master repre- senting the owner, with authority to pledge the ship whenever his necessities require it, the law implies a pledge where repairs are order. It will be observed that this statement confines implied liens for repairs and sup- made or supplies furnished abroad, on his remote from his owner he shall be able to subject the owner’s property to that lia- bility, without which it is unreasonable to believe he will not be able to pursue his owner’s interest. When the owner is present the reason ceases, and the contract is in- ferred to be with the wewner himself, on bis ordinary responsibility,—without a view to the vessel.””’ In Thomas vs, Osborne, 19 How., the Chief Justice says: “Now, if Leach is to be regarded as owner for the time, then by the maritime law the repairs and supplies furnished at his personal re- quest are presumed to be furnished upon his personal credit, unless the contrary is shown: and in that view of the subject Lering & Com- pany, (the libelants) have not, and never had any lien on the vessel. But if, on the contrary, Leach is to be regarded as the master, and as making the contract by virtue of his authority, over the barque in that character, then the repairs and supplies in a foreign port, if necessary to enable the vessel to proceed, are presumed to have been made on the credit of the vessel, unless the contrary is shown, It is immateral that this is found in a dissenting opinion. There was no question respecting the law. The disagree. ment was about facts—the relation which Leach bore to the vessel. Justice Curtis, speaking for the court, in the same case, said: ‘‘It is true, it, [the implied lien,] does not exist ina pluce where the owner is present. But this doctrine cannot be safely extended in the case of an owner pro hac vicg in command of a vessel. Practically, | his special ownership leaves the enterprise subject to the same necessities, as if the mas- ter was merely maser; and not the chart- erer.”” In the Grapeshot, 9 Wall. 136, the rule is similarly stated. In the Lulu, 10 Wall, 208, Justice Clifford says. ‘‘Viewed in any light it is clear that the necessity for credit must be presumed, where it appears that the repairs and supply were ordered by the master alone, and were necesgary.”? In the Emily Sowden, 17 Wall, 67. the court says: ‘The presumption is, in the absence of fraud, that where allowances are made to a captain ina foreign port, to pay for neces- say repairs and supplies, to enable his vessel to prosecute her voyage, they are made on the credit of the vessel.’’ In the Mary, Bell 1 Sawyer, 180, where the master was owner also, a lien for repairs in a foreign port was imnplied, because, as the court held, the con- tract was with him as master. But for this the lien would have been denied. In Steven- son vs. the Frances, 2 Fed. Rep. 715, and the Norman, 6 Fed Rep. 406, the doctrine of implied lien for repairs and supplies is simi- larly stated,—The notion of extending it to debts contracted by the owner is of recent origin. The wisdom of so extending it is certainly open to grave doubt. Why should it be thus extended? ‘The owner, being present, may authorize an express lien; he is hampered by no question of authority. If willing to bypothecate his vessel, he can agree to do so. Such an agreement removes all room for speculation and uncertainty. If the creditor does not require this, why allow him to set up an implied hypothecation? A pledge to be im- plied or not, as the court may understand and construe the circumstances? It is with- in his power to avoid all doubt and un- certainty—all necessity for appealing to inferences, and consequently all danger of mistake. If it be said the master, also, may contract specifically within the limited scope of his authority, it may be answered, that while this might have been a sufficient reason for denying the implication of a pledge even for his debts, it certainly is not tor extending the doctrine to those of the owner. Nevertheless, it is asserted in several re- cent cases, thata lien may be implied for such debts contracted by the owner, and in one instance, at least, it is so decided. I find no case in which the Supreme court bas so determined. In the Guy, 9 Wall, 758, the debt was contracted by the owner. The court allowed the lier; without, however, entering into any discussion of this question, —whicb does not appear to have been raised. The only point considered was whether an exception taken for the debt, discharged the lien, The facts are insufficiently reported. A reference to the opinion of the court be- low, (1 Ben. 115,) shows that the evidence proved the existence of an express lien. The court so found, in express terms; and it is in this view of the facts thata lien was allowed. In the Kalorama, 10 Wall. 214, it is said by Justice Clifford, that alien may exist for such a debt of the owner, It must be inferred that an implied lien was intended by the terms used, because it could not be questioned that an express lien might exist. The question, however, was notin the case; and the judge concludes by saying so. “It is quite clear,” he remarxs, “that the repairs were made and supplies furnished, with an express understanding between the parties that they were so made and furnished, on the credit of the vessel. With this explana- tion the case loses all importance, except such as may attach to the obiter dicta of an eminent judge. In the George I. Kemp, 2 Lowell, decided in 1876, by the district court for Massachusetts, the question was distinctly presented. No discussion of the the subject is found in the opinion. The lien was allowed, the court saying simply: “It was formerly held that if the owner is present no lien will be implied * * * It is not now the law that the presence of the owner, in a foreign port, precludes the possibility of a credit to the vessel, by the general maritime law. ‘This assumption was expressly overrulled in the Guy, 1 Bened. 112, 9 Wall. 758; the Kalorama, 10 Wall. 204,’? These authorities certainly support the preposition that a lien for such debt of the owner is “possible,” as here stated, Noone has ever questioned that an express lien may exist wherever the owner chooses to create it. It was an implied lien, however, of which the court was speaking, and the cases cited, as we have seen, do not support, (in my judgment,) the conclusion reached. I find no other case in which the question can properly be said to have been so decided. In 1883, it arose in the Frances, (above cited,) and after deliberate considera- tion the court held, that ‘a known owner who obtains supplies in a foreign port, not being master, deals presumptively on his personal credit, and no lien will be implied, unless the libelant satisfies the court that there was acommon understanding that the ship should be bound.” In other words, unless the libelant proves an express lien, The Metropolis, 8 Bened. 19, is to the same effect. This review has satisfied me that the doctrine of implied lien for supplies and re- pairs, has not been extending to debts con- tracted by the owner,—saving perhaps in ex- ceptional cases, where it appears that the circumstances are such as to forbid, abso- lutely, the presun ption that the debt was contracted without a pledge of the vessel. In other words, that the presumption of re- liance upon the owner’s personal credit sti] exists, and will prevail, (at least) such pres- sing circumstance of necessity are shown as demand a conclusion that the vessel was pledged,—as when she is in distress, distant from home, and the owner actually without credit. Now, repeating the inquiry: Was the Mary Morgan subject to lien? (1) Was she ina foreign pert? Her owner was a New Jersey corporation. If the statement went no further she was foreign to Chester. Her owner was, however, engaged in business here, and seems to have little elsewhere. The principal corporation officers resided where the meetings of the corporation was held. Here, too, the vessel’ was registered ; and the port was visited by her daily. What influences should these facts exert? Do they or not show the owner to have had a virtual residence in Pennsylvania? A corporation cannot change its citizenship under the Federal laws. This, however, is not the point involved. lta corporation be chartered in one state, with a view to transacting business in another, hay-. ing its property, office and officers all there, would it (in the sense involved) be foreign to the latter state? Could the doctrine ot implied lien be invoked for repairs and sup- plies, obtained for its vessels there? Sup- pose a merchant of Philadelphia has his home across the river in New Jersey,—his stores and property all being here,—would his ves- sels on their return voyages be treated as foreign to this port, and subject to implied liens for repairs and supplies? Would not such an application of the doctrine, ignore the reasons on which it rests? The owner would be liable to suit (and his property to execution) here. And here would be the | seat of his financial standing and credit. | The case supposed, however, goes some- what beyond the facts of our case. Whether | the Mary Morgan should be regarded as foreign, may be open to doubt. In the view I entertain of the case the question need not be decided. The debt was contracted by her owners. The prepumption, therefore that credit was given tothem personally. This presump- tion must stand, (at least,) until answered by evidence, sufficient to repelit. I have fuiled to discover any such evidence in the case. There was no agreemeant for a lien; nor was there anything in the situation of the vessel or her owners, at the time, to justify the conclusion that a pledge was mutually intended. Regarding the owners as foreign, they were nevertheless very near 1 eighbors of the libelant; and presumably as well known financially, as if residents here. Itis not important that Mr. Parker testifies that he did not know the corporation. He was an- aware even, that its home was not here. Doubtless he supposed it was. He knew its principal officers all resided, that the vessel registered, and its business was transacted, here. So far from showing that the vessel was iu distress, the owners without credit, and a pledge of the property necessary, the circumstances would seem to show, very plainly, that no such necessity existed. Not only was the vessel in a familiar port, but so near home, that she had only to cross the river to get there. Nothing stood in the way of her doing this. Nor is there anything to indicate that the repairs and supplies could not have thus been obtained on the usual credit in such cases, There was nothing, therefore, in the situation to demand a pledge of the vessel, and, consequently, nothing to repel the presumption of credit, to the owners alone. That the account is charged to the vessel is unimportant; this was doubtless the result of business habit. Nor is it important that the libelant may have contemplated alien. What he con- templated, without expressing to the owner, does not affect the latter. It is quite pro- bable, notwithstanding what Mr. Parker says, that a pledge was not thought of by any one. In any view, it was clearly un- necessary to the libelant’s safety. Why then should it have been'thought of ? Under the laws of Pennsylvania, the libelant was entitled to hold the vessel until paid; and the existence of this statute accounts for the habit of charging referred to, The omission — to hold the vessel under this statute,—which afforded an ample simple and entirely — certain security, and remedy, indicates quite clearly that the credit of the owner alone — was relied upon; that an admiralty pledge was not thought of. j The vessel was not, therefore, in my ment, subject to a lien. ae If she was, however, | think it was dis- — charged by the subsequent sheriff’s sale. — The acceptance of a note or other similar — obligation for the claim, would not have worked this result. Whether’ proceedings — to judgment for it would, has been doubted in asmilar case: The Kalorama, 10 Wall. — 219. A sale, however, of the vessel, is quite a different thing. Ican recall no instance — in whieh a creditor may sell his debtor’s — property a second time, forthe same debt. — He invites the public to purchase, proposing — to take the proceeds, while the purchase takes the property. How can he afterwards, — in effect, claim the property also. It seems to me that no authority for this proposition can be needed, Probably no direct authority exists; for itis unlikely that such aquestion has arisen, The instances most nearly — analogous are those of Mortgage, and Me- __ chanics’ lien, creditors who sell the property bound, on judgment subsequently obtained, — without reference to the lien, for the same debt; where it is held that the sale dis- charges the lien; though the debt may re- _ main unpaid, Somewhat similar is the case — of a vendor, who holds the legal title as security for purchase money and ee. land on a judgment obtained for the same debt. 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