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    Petition of Texas Co. The Washington, 213 F.2d 479, 2d Cir. (1954)

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    1. The Texas Company filed a petition for limitation of liability in federal court after its tanker, the Washington, collided with a U.S. Navy ship near Virginia in 1952, resulting in personal injury and death claims totaling $2.2 million. 2. Claimants moved to modify an injunction preventing other lawsuits, arguing claims were now less than the tanker's value. The court denied this, finding it had jurisdiction as original claims exceeded the value. 3. On appeal, the court determined that as claims have been reduced by stipulation to less than the tanker's value, a concourse of claims is no longer necessary, so the injunction is lifted on condition of an amended stipulation being

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    Petition of Texas Co. The Washington, 213 F.2d 479, 2d Cir. (1954)

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    1. The Texas Company filed a petition for limitation of liability in federal court after its tanker, the Washington, collided with a U.S. Navy ship near Virginia in 1952, resulting in personal injury and death claims totaling $2.2 million. 2. Claimants moved to modify an injunction preventing other lawsuits, arguing claims were now less than the tanker's value. The court denied this, finding it had jurisdiction as original claims exceeded the value. 3. On appeal, the court determined that as claims have been reduced by stipulation to less than the tanker's value, a concourse of claims is no longer necessary, so the injunction is lifted on condition of an amended stipulation being

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    Filed: 1954-05-26 Precedential Status: Precedential Citations: 213 F.2d 479 Docket: 23064_1

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    1. The Texas Company filed a petition for limitation of liability in federal court after its tanker, the Washington, collided with a U.S. Navy ship near Virginia in 1952, resulting in personal injury and death claims totaling $2.2 million. 2. Claimants moved to modify an injunction preventing other lawsuits, arguing claims were now less than the tanker's value. The court denied this, finding it had jurisdiction as original claims exceeded the value. 3. On appeal, the court determined that as claims have been reduced by stipulation to less than the tanker's value, a concourse of claims is no longer necessary, so the injunction is lifted on condition of an amended stipulation being

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    22 views5 pages

    Petition of Texas Co. The Washington, 213 F.2d 479, 2d Cir. (1954)

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    1. The Texas Company filed a petition for limitation of liability in federal court after its tanker, the Washington, collided with a U.S. Navy ship near Virginia in 1952, resulting in personal injury and death claims totaling $2.2 million. 2. Claimants moved to modify an injunction preventing other lawsuits, arguing claims were now less than the tanker's value. The court denied this, finding it had jurisdiction as original claims exceeded the value. 3. On appeal, the court determined that as claims have been reduced by stipulation to less than the tanker's value, a concourse of claims is no longer necessary, so the injunction is lifted on condition of an amended stipulation being

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    of 5

    213 F.

    2d 479

    Petition of TEXAS CO.


    THE WASHINGTON.
    No. 222.
    No. 266.
    Docket 23008.
    Docket 23064.

    United States Court of Appeals Second Circuit.


    Argued April 7 and 8, 1954.
    Decided May 26, 1954.

    On November 15, 1952, the Tanker Washington, owned by The Texas


    Company, collided with the U. S. S. Ruchamkin at sea near Cape Henry,
    Virginia. As a result, eight personal injury and death actions were filed
    against The Texas Company in the district court, and a libel was filed by
    the United States, as owner of the U. S. S. Ruchamkin in the United States
    District Court for the Eastern District of Virginia. The total damages
    sought in all these suits was $2,225,180, on April 17, 1953, The Texas
    Company commenced limitation proceedings in the court below and filed
    an ad interim stipulation for value in the sum of $2,109,957.58. The usual
    injunction order was issued against the commencement or prosecution of
    all suits or proceedings except in the limitation proceeding and a monition
    issued to all claimants to file their claims on or before June 2, 1953.
    The plaintiffs in the pending suits, other than the United States, moved
    before Judge Ryan for modification of the injunction order, to permit the
    movants to proceed with their suits but reserving to the court below "the
    determination of the issue of exoneration from or limitation of liability."
    Judge Ryan, by an order dated November 17, 1953, denied the motion. He
    wrote an opinion reading as follows:
    "Petitioner, as owner of the tanker Washington has petitioned for
    exoneration from or limitation of liability under 46 U.S.C.A. 183-9.
    This motion is to modify a restraining order dated April 17, 1953 which
    enjoined suits brought by individual claimants.

    "Section 183(a) provides that `the liability of the owner of any vessel * *
    for any loss, damage, or injury by collision * * * done, occasioned, or
    incurred, without the privity or knowledge of such owner or owners, shall
    not * * * exceed the amount or value of the interest of such owner in such
    vessel, and her freight then pending.' Movants allege that the sum total of
    claims against the vessel is less than the value of it and her freight, that
    this Court has no jurisdiction to grant limitation of liability and
    consequently no power to enjoin individual actions.
    "It appears, however, that the total of the claims originally made was
    greater than the value of the vessel, although some of these claims were
    reduced subsequent to the filing of the petition for limitation. The fact that
    claims greater than the value of the vessel and cargo were asserted gave
    the Court jurisdiction to entertain the petition for limitation. This
    jurisdiction is not divested by subsequent diminution of claims. The
    Tolchester [D.C.], 42 F. 180, and The John K. Gilkinson [D. C.], 150 F.
    454. The individual suits may not be allowed to continue even for the
    purpose of ascertaining damages. The Tolchester.
    "Supreme Court Admiralty Rule 54 [28 U.S.C.A.] provides that the
    petition for limitation of liability, if the vessel has not been libeled, may
    be brought in the district court for any district in which the owner has been
    sued in respect to any such claim. Eight actions have been commenced in
    this district. Venue has been properly laid and the restraining order was
    proper.
    "Since I have concluded that subsequent reduction of claims does not
    affect jurisdiction, it will serve no useful purpose to withhold decision on
    this motion pending the contemplated filing of additional stipulations of
    reduction.
    "Motion denied."
    Before Judge Weinfeld, the United States moved to transfer the libel
    instituted against it by The Texas Company to the United States District
    Court for the Eastern District of Virginia, to be there tried with the libel
    which the United States had there previously instituted against The Texas
    Company. The United States also moved to modify the injunction order so
    as to permit the suit in the Virginia district to go forward. There was
    presented to Judge Weinfeld a stipulation by the various plaintiffs,
    including the United States, that they had reduced their claims so that in
    the aggregate they amounted to $1,754,333.93.1 It appears that these
    stipulations were also at some time presented to Judge Ryan.

    The stipulation by the plaintiffs other than the United States stated that
    they would not increase the amount of their claims at any future date if
    The Texas Company's petition for limitation of liability were forthwith
    dismissed. However, in this court, on the argument of the appeal, all the
    claimants advised this court that they will file an amended stipulation in
    the district court agreeing that their claims will never be increased, that
    the claimants will not enter judgment in any court in excess of the
    stipulated amounts, and that any claim of res judicata relevant to the issue
    of limited liability, based on a judgment in any other court, is waived.
    Judge Weinfeld granted the motion of the United States. His order, dated
    January 29, 1954, reserved for determination by the court below, The
    Texas Company's right to all other relief prayed for in its limitation
    petition. His opinion is reported in 116 F.Supp. 915.
    From Judge Weinfeld's order, The Texas Company has appealed; from
    Judge Ryan's order, the claimants who had moved before him for
    modification of the injunction have appealed.
    Thacher, Proffitt, Prizer & Crawley, New York City (Joseph M. Brush,
    New York City, of counsel), for Texas Co.
    J. Edward Lumbard, U. S. Atty. for Southern District of New York, New
    York City (Louis E. Greco, New York City, of counsel), for the United
    States.
    Sterling & Schwartz, New York City (Marvin Schwartz and Betty Olchin,
    New York City, of counsel), for claimants.
    Before CHASE, Chief Judge, and SWAN and FRANK, Circuit Judges.
    FRANK, Circuit Judge.

    1. The United States has moved to dismiss The Texas Company's appeal from
    Judge Weinfeld's order. The motion is denied. We have jurisdiction of the
    appeals. See W. E. Hedger Transp. Corp. v. Gallotta, 2 Cir., 145 F.2d 870;
    Curtis Bay Towing Co. v. Tug Kevin Moran, Inc., 2 Cir., 159 F.2d 273.

    2. Although the claims as originally filed exceeded the fund (or stipulated
    value) of $2,109,957.58, they have now been reduced by stipulation so that the
    fund is about $350,000 in excess of all filed claims. As a consequence, we do
    not have the problem of a distribution of an insufficient fund contemplated by

    the statute. For 46 U.S.C.A. 184 provides that, when loss is suffered by
    several persons, "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 * * * in proportion to their respective losses", and that
    the limitation proceedings are "for the pur- pose of apportioning the sum * * *
    among the parties entitled thereto." 2
    3

    We have several times announced the principles which we think must apply
    here: Absent an insufficient fund (1) the statutory privilege of limiting liability
    is not in the nature of a forum non conveniens doctrine, and (2) the statute gives
    a ship-owner, sued in several suits (even if in divers places) by divers persons,
    no advantage over other kinds of defendants in the same position. Concourse is
    to be granted "only when * * * necessary in order to distribute an inadequate
    fund."3 The "purpose of limitation proceedings is not to prevent a multiplicity
    of suits but, in an equitable fashion, to provide a marshalling of assets the
    distribution pro rata of an inadequate fund among claimants, none of whom can
    be paid in full."4 We see nothing to the contrary in Maryland Casualty Co. v.
    Cushing, 347 U.S. 409, 74 S.Ct. 608, where the claims aggregated $600,000
    and the Court was advised the valuation was but $25,000.

    3. The Texas Company asserts, however, that the record shows there are or
    may be persons injured by the collision who have not yet filed but who may
    later file claims which, together with those already filed, may exceed the fund.
    But, as in Curtis Bay Towing Co. v. Tug Kevin Moran, Inc., 2 Cir., 159 F.2d
    273, on the facts here with the maximum amount of the filed claims fixed by
    stipulation there is little likelihood that other claims will be asserted before
    they are barred by applicable statutes of limitation or otherwise. As in that case,
    the district court will retain jurisdiction of the limitation proceeding, so that if,
    "by some chance * * * other claims should appear which will make a
    concourse proper, a concourse can take over the situation as it then is * * *."
    Accordingly, we deem irrelevant the argument of The Texas Company as to
    ouster of the jurisdiction of the court below.

    4. For the reasons stated in Judge Weinfeld's opinion, we think his order
    correct.5 It will be affirmed on the condition that the proffered amendment to
    the stipuation will be filed promptly in the district court. On the same
    condition, we reverse Judge Ryan's order.

    Notes:

    The United States stipulated that its entire claim, theretofore stated as $800,000,
    was $601,833.93, and that any contingent claims it had asserted for
    hospitalization and pensions were merely by way of setoff which would arise
    when and if the Texas Company should pay an injury claim and then assert
    such payment as part of the Texas Company's alleged claim against the United
    States

    Emphasis added

    Curtis Bay Towing Co. v. Tug Kevin Moran, Inc., 2 Cir., 159 F.2d 273, 276

    Petition of Moran Transp. Corp., 2 Cir., 185 F.2d 386, 388-389. See also
    Petition of Red Star Barge Line, Inc., 2 Cir., 160 F.2d 436; The Aquitania,
    D.C., 14 F.2d 456, 458, affirmed, 2 Cir., 20 F. 2d 457

    This court has heretofore dismissed the appeal from Judge Weinfeld's order
    transferring to the Virginia district the suit by The Texas Company against the
    United States

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