While a claim for salvage of government property based on
services rendered without request of any officer of the government
does not arise upon any contract, express or implied, it is
properly one for unliquidated damages in a case not sounding in
tort, in respect to which the claimant would be entitled to redress
in the admiralty court if the United States were suable, and, under
the Tucker Act, the Court of Claims, or the proper district court
where the claim is for less than $1,000, has jurisdiction of a suit
therefor.
The successful salving of undelivered merchandise on which
duties have been paid, but which the Secretary of the Treasury is
authorized by §§ 2984, 3689, Rev.Stat., to refund if the goods were
lost, entitles the salvors to recover from the government a
reasonable salvage equal to that recovered on the private property
saved at the same time, on the amount of duties which the
government would have been under obligation to refund had the
merchandise been lost. In such a case, it will be assumed that the
duties will be refunded, and the claim therefor will be regarded as
a liability, although § 2984 is permissive, and not mandatory, in
form.
Although courts of admiralty have no general equity
jurisdiction, and cannot afford equitable relief in a direct
proceeding for that purpose, they may apply equitable principles to
subjects within their jurisdiction.
This was a petition under what is known as the Tucker act,
defining the jurisdiction of the Court of Claims, to recover
salvage upon the duties on 1,883 bags of sugar, cargo of the
lighter
Bangor.
The facts agreed upon and found by the court are substantially
as follows:
The Steamboat Company, a New York corporation, and owner of the
steam tug
R. G. Townsend at great risk and peril to the
tug, saved a certain lot of 1,883 bags of sugar on board of a
lighter called the
Bangor, in the waters of the port
Page 202 U. S. 185
of New York, which was in danger of being destroyed by fire. The
sugar had been imported from a foreign country, was subject to duty
under the laws of the United States, and at the time of the fire
had not been delivered to the consignees, and was still in the
possession and control of the customs officers. The duties on this
sugar, amounting to $6,000, had been paid to the government.
Petitioner filed a libel in the district court against the cargo
to recover salvage compensation for services rendered in saving the
sugar. The case resulted in a decree awarding the petitioner
salvage, amounting to ten percent of the value of the property
saved,
viz., $1,274.03. 108 F. 277. In fixing this sum,
the district court considered the invoice value of the sugar only,
excluding salvage upon the duties saved to the United States by the
salving services.
Upon these facts, the district court awarded the petitioner ten
percent upon the amount of the duties saved to the United States --
namely, $600, with clerk's fees, $3.60. 130 F. 480. The circuit
court of appeals affirmed this judgment, 137 F. 455, whereupon the
United States applied for this writ of certiorari.
Page 202 U. S. 189
MR. JUSTICE BROWN delivered the opinion of the Court.
This is practically a libel
in personam for the salvage
of government property,
viz., of $6,000 duties collected
by the government upon a cargo of sugar saved from loss by fire
while on board a lighter in the harbor of New York.
The claim is prosecuted under what is known as the Tucker Act,
24 Stat. 505, c. 359, the first section of which declares that
"the Court of Claims shall have jurisdiction to hear and
determine . . . all claims founded upon the Constitution of the
United States, or any law of Congress, . . . or upon any contract,
express or implied, with the government of the United States, or
for damages, liquidated or unliquidated, in cases not sounding in
tort, in respect of which claims the party would be entitled to
redress against the United States, either in a court of law,
equity, or admiralty, if the United States were suable."
By the second section, concurrent jurisdiction with the Court of
Claims was vested in the district courts as to all claims not
exceeding $1,000.
It is at least doubtful whether an ordinary claim for salvage
can be said to arise upon contract, inasmuch as such services are
rendered voluntarily, frequently in the absence of the owner of the
property, and usually without a definite agreement for
compensation.
The Liffey, 6 Asp.Mar.L.C. 255;
Page 202 U. S. 190
Five Steel Barges, L.R. 15 P.D. 142. A claim for
salvage may undoubtedly be founded upon an express contract, but
where the services are rendered, as in this case, without request
of an officer of the government, and particularly where they are
incidental to services rendered in the saving of private property,
we do not think the claim can be said to arise upon any contract,
express or implied, with the government of the United States. But
the claim may properly be said to be one for unliquidated damages
in a case "not sounding in tort," in respect of which the party
would be entitled to redress in a court of admiralty if the United
States were suable.
The Tucker Act also resolves any doubt which might arise as to
the responsibility of government property for salvage service,
since it was the very object of the act to give a direct recourse
against the government. Indeed, that question was settled by this
Court in 1869, in the case of
The Davis, 10
Wall. 15, in which personal property of the United States, in
transit from one port to another, was held liable to a lien for
salvage services rendered in saving the property, following the
rule laid down in England in
The Marquis of Huntly, 3
Haggard 247, and
The Lord Nelson, Edward's Admiralty 79.
The same rule was adopted by Mr. Justice Story in
United States
v. Wilder, 3 Sumner 308, although both in England and in this
country vessels belonging to the United States or to a foreign
sovereign and engaged in the public service are exempt from
seizure.
The Exchange v.
M'Faddon, 7 Cranch 116;
The Charkieh, L.R.
4 A. & E. 59;
The Constitution, 4 P.D. 39;
The
Parlement Belge, 4 Asp.M.L.C. 234, 5 P.D. 197.
The fact, however, that the property saved is not within the
physical possession of the court, but is of an intangible nature,
like freight or customs dues, does not prevent the maintenance of a
libel
in personam against the owner. Indeed, General
Admiralty Rule No. 19 provides that,
"in all suits for salvage the suit may be
in rem . . .
or
in personam against the party at whose request, and for
whose benefit, the salvage services have been performed."
In the case of freight, the
Page 202 U. S. 191
practice is to require its payment into court.
The Leo,
Lush. 444.
At the basis of the claim in this case lies the proposition
that, although the duties had been actually paid before the
services had been rendered, the Secretary of the Treasury was
authorized to refund duties upon so much of the sugar as would have
been lost by the fire had not the cargo been rescued by the
salvors. The obligation to refund such duties is contained in the
following sections of the Revised Statutes:
"SEC. 2984. The Secretary of the Treasury is hereby authorized,
upon production of satisfactory proof to him of the actual injury
or destruction, in whole or in part, of any merchandise, by
accidental fire or other casualty, while the same remained in the
custody of the officers of the customs in any public or private
warehouse under bond, . . . or while in the custody of the officers
of the customs, and not in bond, or while within the limits of any
port of entry, and before the same have been landed under the
supervision of the officers of the customs, to abate or refund, as
the case may be, out of any moneys in the Treasury not otherwise
appropriated, the amount of impost duties paid or accruing
thereupon, and likewise to cancel any warehouse bond or bonds, or
enter satisfaction thereon in whole or in part, as the case may
be."
Provision for such abatements or refunds is made in:
"SEC. 3689. There are appropriated, out of any moneys in the
Treasury not otherwise appropriated, for the purposes hereinafter
specified, such sums as may be necessary for the same,
respectively, and such appropriation shall be deemed permanent
annual appropriations. . . . For refunding duties paid or accruing
on goods, wares, or merchandise injured or destroyed by accidental
fire or other casualty while in the custody of the officers of
customs, in any public or private warehouse, . . . or after their
arrival within the limits of any port of entry, of the United
States, and before the same have been landed under the supervision
of the officers of the customs. "
Page 202 U. S. 192
It was held by both courts below, and we think properly, that,
if the government were liable to refund these duties in case the
property had been destroyed by fire, it was under the same
obligation to pay salvage on such duties as it would have been had
property of the government of the same value been directly saved by
the exertions of the salvors.
It is true that the language of § 2984 is permissive, and merely
"authorizes" the Secretary of the Treasury to abate or refund
duties collected upon merchandise injured or destroyed by
accidental fire or other casualty, and does not in terms require
that this shall be done. We do not find it necessary, however, to
go deeply into the learning expended upon the distinction between
permissive and mandatory clauses, or to determine whether, in a
particular case, mandamus would or would not lie against the
Secretary for refusing to refund or abate duties in that
connection.
D. M. Ferry & Co. v. United States, 85 F.
550. Under the circumstances of this case as set forth in the
petition and agreed findings of fact, we are entitled to assume
that the Secretary of the Treasury would have refunded these duties
in case of the accidental loss of this sugar by fire, since the
authority to do so is found in § 2984 and the money is appropriated
for such refunding by § 3689. In a particular case, we can imagine
that doubts might arise as to the propriety of such refunding, but
where a plain case in made in the findings of fact and is not
disputed, it would be an imputation upon the good faith of the
Secretary to assume that he would refuse to return the duties
notwithstanding the language of the statute may be construed as
permissive merely. We think the petitioner is entitled to build his
case upon this assumption.
Rock Island County v. United
States, 4 Wall. 435;
Galena v.
Amy, 5 Wall. 705;
French v.
Edwards, 13 Wall. 506.
It is insisted, however, that the government is under no greater
liability to pay this claim than it would have been if the duties
had not been paid, and that the law is well settled that, when
property is saved at sea and brought into port, it is
Page 202 U. S. 193
subject to duty like other property, that the government owes
nothing to the salvors, and, by parity of reasoning, that no
insurer of goods saved, nor a creditor who has advanced money
thereon, nor a seaman whose wages are preserved, can be made liable
for salvage. The obvious reason for this is that the claim for
salvage is founded upon the possession of the property saved at the
time of the salvage service, and that the person incidentally
benefited cannot be made liable under General Admiralty Rule 19
unless he has requested the salvage or the service has been
performed directly for his benefit. Interpreting this rule in the
case of
The Sabine, 101 U. S. 384, it
was held that a libel would not lie
in rem against the
vessel and
in personam against the consignee of the cargo.
But the mere possession of property may be, in itself, not only the
origin of a right, but the creation of a liability -- as, for
instance, in cases of money had and received or property lawfully
acquired but unlawfully detained. Had the duties upon these goods
not been collected, the government could not have been held liable,
since the services would not have been performed for its benefit,
although, as a remote consequence therefrom, if might have been
advantaged.
The case of
The Five Steel Barges, 15 P.D. 142, is
authority for the proposition that the remedy
in personam
is not confined to the legal owner of the property saved, but
extends to one who has a direct pecuniary interest in such
property. This was an action against five barges, two of which
belonged to the government, with whom the defendants were under
contract to build and deliver the barges. An action
in rem
was brought against the three barges, and an action
in
personam against the defendants, who had contracted with the
government and given it possession of the two barges. The court
sustained the action
in personam thinking it
"perfectly clear . . . that an action
in personam lies
against the owners of a vessel which has been saved, even though
the property has been transferred to others and the lien lost."
Continuing, the President of the Court, Sir James Hannen,
observed:
"I think it exists in cases
Page 202 U. S. 194
where the defendant has an interest in the property saved, which
interest has been saved by the fact that the property is brought
into a position of security. The jurisdiction which the court
exercises in salvage cases is of a peculiarly equitable character.
The right to salvage may arise out of an actual contract, but it
does not necessarily do so. It is a legal liability arising out of
the fact that property has been saved; that the owner of the
property, who has had the benefit of it, shall make remuneration to
those who have conferred the benefit upon him, notwithstanding that
he has not entered into any contract on the subject. I think that
proposition equally applies to the man who has had a benefit
arising out of the saving of the property."
This last sentence is particularly applicable to this case.
In the subsequent case of
The Port Victor, 9 Asp.M.L.C.
163, the same court decided that, where government stores were
being carried at the risk of charterers, these charterers were
liable to pay salvage in a
personam action, apart from the
liability of the stores
in rem. The case was decided
largely upon the authority of
The Five Steel Barges and
Duncan v. Dundee &c. Shipping Company, in the Court of
Sessions in Scotland, 4th Series, vol. 5, p. 742, and was affirmed
by the Court of Appeals in an opinion by Lord Alverstone, 9
Asp.Mar.Cas. 182, in which great deference was shown to the
decision of Sir James Hannen.
See also Carver on Carriage
by Sea, § 324a.
Although courts of admiralty have no general equity
jurisdiction, and cannot afford equitable relief in a direct
proceeding for that purpose, they may apply equitable principles to
subjects within their jurisdiction, and, in the distribution of
proceeds in their possession or under their control, may give
effect to equitable claims. 2 Parsons, Shipping 344. Bearing in
mind that the duties in this case had been actually collected, were
in the hands of the government, and had been saved to it by the
exertion of the salvors, who had been awarded salvage for saving
the sugars upon which the duties had been
Page 202 U. S. 195
collected, a strong case is presented for the allowance of
salvage, which should not be lost sight of in determining the
principles applicable to the situation.
The case is clearly not one arising under the revenue laws as
they are defined in
Nichols v. United
States, 7 Wall. 122, since the sections of the
Revised Statutes above quoted are only incidentally involved.
The decree of the circuit court of appeals is therefore
Affirmed.
MR. CHIEF JUSTICE FULLER dissented.