Case ID: us-ct-cl_57/html/0238-01.html
Source: Caselaw Access Project
Author: {"author": "", "license": "Public Domain", "url": "https://static.case.law/"}
Date Created: 2024-08-24T03:29:51.129683

JOHNSON LIGHTERAGE COMPANY v. THE UNITED STATES.
    [No. 34623.
    Decided April 3, 1922.]
    
      On the Proofs.
    
    
      Contract; demurrage. — Where plaintiff enters into a contract with the Government to transport materials to different places in lighters, some of which are hired from the Government, and agrees to put all of its equipment employed in proper condition for such service, and uses the Government lighters in the same way as its own, they are carrier’s lighters within the meaning of a clause of the contract which provides that a demurrage charge of 10 cents per ton per day shall be paid by the Government for all materials “ on the carrier’s lighters 72 hours after lighter has been loaded on orders by the Government and ready to tow,” and the plaintiff is entitled to recover all demurrage on shipments on such Government lighters.
    
      The Reporter's statement of the case:
    
      Messrs. H. Stanley Hinrichs and Homer D. Cumvmings for the plaintiff. Messrs. Charles D. Lockwood, Frank 8. Bright, and Raymond E. Hackett were on the briefs.
    
      Mr. Alexander II. McCormick, with whom was Mr. Assistant Attorney General Robert H. Lovett, for the defendant.
    The following are the facts of the case as found by the court:
    I. The plaintiff is, and was during the transactions hereinafter set out in these findings of fact, a corporation, duly incorporated under the laws of the State of New York, with its principal place of business located in New York City.
    II. On June 15, 1918, the plaintiff entered into a contract with the United States to transport in lighters all shipments of explosives, artillery ammunition, shells, and ordnance materials of all sorts for the period of one year beginning July 1, 1918, to and from all points in New York Harbor and contiguous waters,, alongside ships or docks or to explosive areas. The said contract has been set out in full in Exhibit A to plaintiff’s petition and is made part of this finding by reference thereto.
    III. All of the articles specified in the contract were transported by plaintiff in lighters, some in its own, some in those hired from private parties, and some in 33 lighters owned and furnished to plaintiff by the United States, which charged no hire therefor, but received its compensation in the reduced cost of shipments in Government-owned lighters.
    IY. The said Government lighters were manned, operated, repaired, and controlled by plaintiff during the period they were in its service from July 12., 1918, to May, 1919, and upon delivery of said lighters, or shortly thereafter, the following form of receipt was signed by plaintiff for each lighter furnished:
    “Under the provisions of para. E-2 of contract dated June 15, 1918, by and between the United States and the Johnson Lighterage Company, the Johnson Lighterage Company does hereby acknowledge receipt this date in good order and condition of United States scow No. — and does agree—
    “ 1. That while said vessel is in the possession of the John- . son Lighterage Company, under the provision of the aforesaid contract, the Johnson Lighterage Company will assume all risks of damage to said scow; the Johnson Lighterage Company will return said scow to the United States in as good order and condition as when received, fair wear and tear excepted.
    “2. That the Johnson Lighterage Company will assume marine and all other risks of whatsoever nature or kind, including liability for damage occasioned to other vessels, persons, or property.”
    Y. The said Government lighters when furnished to plaintiff were neither in good repair nor properly equipped to comply with the rules and regulations of the War Department governing the transportation of explosives, and in order to meet those requirements plaintiff was compelled to expend the sum of $19,989.77, for which a bill was rendered to the Government on October 19, 1918, of which the assistant director of shipping, in a letter to the vice president of the plaintiff company, dated November 20, 1918, refused to recommend payment. The letter reads:
    
      “ Dear Sir: Your letter of the 16th inst. is received referring to your bill of October 18 amounting to $19,989.77, covering certain improvements made and equipment supplied to a number of U. S. Army scows which were chartered to you at your request.
    “ I have gone into this matter very thoroughly in order to see if it was not possible to meet your views that you should be recompensed for at least a part of the work which you did on these scows, but I regret to say that I do not see how it is possible for me to recommend this.
    “ In the discussions which the late Mr. Theodore Johnson, president of your company, had with me and also Mr. Moran, and also in a conference at this office at which you were presentj it was distinctly understood that this office was chartering those lighters to you at an agreed rate of hire, as they were, and under these circumstances I regret that it is impossible for me to recommend or approve of the Government assuming any of the expenses which you incurred in fitting the lighters for the use which you intended to make of them in your business.”
    After the refusal of the assistant director of shipping to recommend payment of the bill the plaintiff paid the cost of such repairs and equipment, $19,989.77.
    Paragraph I of the contract contains a stipulation that “the carrier agrees that it will conform all its equipment used in this service to the rules and regulations issued by the War Department under date of December 26, 1916, and the present amendments thereto.”
    VI. In the performance of the contract delays occurred in loading and unloading shipments, for which the plaintiff was in no way responsible, and some of such delays occurred in shipments on Government lighters used by plaintiff, and the plaintiff rendered bills to the Government for demur-rage for said delays, as provided by its contract, and said bills were paid as rendered for a period of ten months, or until May, 1919, at which time the aggregate amount paid to plaintiff by the Government for demurrage on shipments carried on Government lighters used by plaintiff amounted to $49,472.62. Thereafter bills rendered to the Government for demurrage on other shipments carried on Government lighters were refused payment, to the amount of $29,778.40, on the sole ground that such demurrage was not provided for by the contract. The said services were actually performed as alleged, and the plaintiff has never been paid for the same.
    VII. The plaintiff also presented to the Government bills for demurrage on shipments carried on lighters that did not belong to the Government to the amount of $26,717.63, and bills for compensation for transportation of articles specified in its contract to the amount of $23,168.76, the two bills aggregating $49,886.39, which the Government admits to be justly due, but refuses to pay upon the ground that its payments of demurrage on shipments carried on its own lighters, $49,472.62, were erroneously made under paragraph F of the contract, which provides that “a demurrage charge of 10$ per ton of 2,000 pounds per day of 24 hours or fraction thereof shall be paid by the Government to the carrier for all materials on the carrier’s lighters 72 hours after lighter has been loaded on orders by the Government and ready to tow.”
   memorandum by the court.

The Government admits that the demurrage charge provided for in paragraph F of the contract is properly payable in the case of lighters owned by the plaintiff and lighters furnished to plaintiff by third parties, but denies that it applies in case the lighters used by plaintiff belonged to the Government. This seems to us to be too narrow a view. The Government-owned lighters were not furnished as a gratuity, but their use resulted in reduced charges to the Government according to the stipulations of the contract. The plaintiff had to put them in condition, had to keep them in condition, had to assume all risks incident to their use and service, and, for the purposes of the contract, they were, in our opinion, in the same category as other lighters used in the particular business. This was the view of the Government originally and bills were accordingly paid to the extent of more than $49,000, and for a period of nearly ten months. “ Carriers’ lighters,” it seems to us, apply to all lighters that were for the time in question used and controlled by the plaintiff in complying with its contract.

Judgment for plaintiff under Findings VI and VII in the sum of $79,664.79.