UNITED 

MARITIME 

RE

TO CO

FOR THE P

OCT

1

UNITE

COVER CTENT 

R tSJIIN
n

UNITED STATES M

OFFICE CO

WASH

COMM

JOSEPH P K

EMORY S LA

EDWARD C 

HENRY A W

THOMAS M 
TABLE O

Introduction 

Creation of Commission 

Administrative organization 

Rules and regulations 

Vessel construction program 

Replacement of Leviathan 

C2 design for cargo vessels 

Tanker construction 

Construction under longterm su

Construction for domestic comm

Labor 

Improvement of crew quarters 

Establishment of labor standards 

Effect of warlike activities 

Settlement of ocean mail contracts 

Operating differential subsidy agreem

Temporary agreements 

Supplemental applications 

Development of longrange subs

Longterm agreements 

Report on granting financial aid 

Exercise of regulatory functions 

Formal docket 

Informal docket 

Special docket 

Agreements under section 15 Sh

Interstate tariffs 

Foreign tariffs 

Litigation and claims 

Insurance 

Transfer of vessel registry and sales t

Commission properties 

Operation of Government owned 

The laidup fleet 

Terminals 

Surplus vessel equipment 

Housing properties 

Financial statement 

Appendix A 

Appendix B 

Appendix C 

LETTER O

UNITED S

To the Congress

I have the honor to presen

States Maritime Conunission 

date of the Merchant Marine 

There is included also a summa

agreements entered into as of J

tion to be undertaken as part o

Section 208 of the act provide

beginning of each regular sessi

shall include the results of its inv

tions its recommmendations for 

under this act and the purpo

made

As the Congress convened in 

1937 the Commission took the o

Economic Survey of the Americ

its

recommendations

investigations were

for legislation

set forth t

The accompanying report co

Commission for the period unde

Very sincerely yours

THE UNITED STATES 

INTR

The United States Maritime C

a mandate to develop and main

carry a substantial portion of 

foreign commerce of the United 

and most suitable type of vesse

by citizens of the United State

and capable of serving as a nava

or national emergency

For the past 6 months the Co

the policies instrumental in carry

establish a sound basis for their 

of the merchant marine from the 

the major obstacles to its develo

been set forth in the Economic 

Marine submitted to the Congre

in that report are the results o

by the Commission in observan

sections 210 211 212 and 213 o

During the Commission sbr

possible to accomplish in a thor

plated by the act A report e

Marine was transmitted to the 

a report on the scrapping or rem

tonnage owned by the United Sta

on tramp shipping will shortly b

tive cost of construction or reco

in the various coastal districts 

recommendations on equalizing 

preparation

The Commission ssurvey adva

ing the development of American 

chant Marine Act of 1936 In c

these suggestions have already be

Congress They require no deta

Creation

The United States Maritime C

pendent governmental agency by 
2 REPORT Or THE UNITE

Merchant Marine Act 1936 

Congress and approved by 

September 26 1936 the Pres

rear admiral United States N

rear admiral United States N

to serve as a temporary Comm

sions of the Merchant Marine 

Although this report deals w

mission from its inception it 

plishments of the Commission 

following appointments were 

Joseph P Kennedy ch

E S Land rear admi

Edward C Moran Jr

H A Wiley rear adm

Thomas M Woodward

Administrative Organization

The staff of the Commissi

employees Approximately 

in the district offices located 

San Francisco and London 

mission sproperties Owing 

of workmen employed on the 

ployees has been reduced by 

portion of its administrative 

mission from the Merchant Fle

Bureau Section 201 e of th

for the certification to the U

of all such employees provid

The work of appraising the q

certifying them to the Civil S

during the course of the su

mately 60 percent have been 

remainder will be submitted t

the end of 1937

A close acquaintance with th

convinced the Commission of 

of experts in various lines to 

wise that an independent aud

been made for some time and 

With these projects in view t

gress a request for authorizatio

to perform special services an

Appropriations Act approved 

sion to allocate not more than 
REPORT OP THE UNITED S

Administration of the operat

which requires supervision over m

has broadened the scope of the 

tated a realinement of administr

A functional chart of the Com

included in the appendix

Rules and Regulations

Proper administration also com

the provisions of the Merchant M

and interpretations under the pow

adopt all necessary rules and re

duties and functions vested in it 

tive standards in some sections of 

clauses in others required prompt a

to do so would have resulted in s

divers problems which the Commi

right of the Commission to pay th

tankers as a national defense fea

dence in determining the amount 

the meaning of competition as u

the Commission to subsidize the o

which compete with foreignflag ve

pretations and rulings were form

General Counsel

Many regulations were issued 

general orders They include re

operating and construction subsid

tion 807 of the act and the minim

scales and reasonable working co

VESSEL CONSTR

It is apparent from even a has

the Commission sEconomic Surve

that the major task facing the C

rapidly aging fleet

It is the Commission sintentio

Merchant Marine Act of 1936 sha

construction with respect to safety 

a considerable advance above the 

national Convention for the Safet

design to be incorporated in any n

latest improvements in machinery 

for both officers and crew as we

required by the Merchant Marine 

38940382
4 REPORT OP THE UNITED 

The foundation for a long

Laid and will be outlined belo

report however only one ap

subsidy has been accepted by 

Replacement of the Leviathan

The replacement of the Le

sion and negotiation for seve

agreement of March 18 19

Co was permitted to lay up 

for the construction of its suc

On different occasions bids w

vessel of the Washington Man

construction was submitted 

States Lines Co construction 

until passage of the Merchan

construction loans In the sp

similar to the steamships Was

technical staff of the Commis

and private interests and o

issued Bids were received fr

Dock Co Bethlehem Shipbu

Shipbuilding Corporation th

Newport News Shipbuilding 

15750 00on an adjusted pri

for the adjustment of the fin

material and labor costs during 

more than 15 percent The co

which was signed on October 

852 days This new liner i

service in 1940 and will cost t

which is the Commission se

of this vessel

C2 Design for Cargo Vessels

Although the initial step in 

the Commission in letting the 

the Leviathan the glaring 

marine is the lack of modern 

has been laid in this country s

with the operators for longte

has placed particular empha

prolonged dearth of construc

The first step taken in 

economical steel cargo vessel 

of this vessel known as the C
REPORT OF THE ITN LIED tC

with the Navy Department the 

Navigation The American Bure

known naval architects Upon 

was submitted to leading shipb

their suggestions as to its adaptab

is felt that the plans and specificat

adjustment in accordance with t

without losing the advantages o

ducted on models of this vessel 

operating costs particularly in the 

The immediate construction o

contemplated Plans and specif

turbine and Diesel propulsion and 

Provision has been made for the 

sum basis or on an adjustedpric

structed for the account of the 

arrangements will be made with 

chase them before construction is 

Tanker Construction

The Commission has negotiate

Jersey for the construction of 12

as naval auxiliaries The cost of 

in excess of normal commercial r

with various features of construct

from the standpoint of national d

ment Besides the 16knot s

purposes other features to be inco

zine spaces gun foundations oili

and pumping arrangement to al

four or more grades of oil The c

for the 12 tankers approximates 850

expenditure involved

Although the Standard Oil Co 

the opportunity to participate o

American companies operating tan

ment these other oil companies m

ships with the approval of the C

pate in this tanker replacement 

Commission prior to February 1 

Certain oil companies have sig

with the Commission in the const

naval auxiliaries but their comm

by vessels of a smaller size If 

with these companies some furth

be undertaken on the basis outlin
6 REPORT OF THE UNITE

Construction tinder LongTerm Su

The longrange subsidy co

involve definite replacement c

companies The seven lines 

between now and 1942 14 of 

addition the companies are re

of approximately 23 other ve

tion has indicated its willingne

1938 and 1942 in the event t

worked out This problem is 

a total of 52 or 53 vessels w

within the next 5 years The 

in the neighborhood of 1100 

provide for automatic cancell

subsidies paid by the Govern

not undertaken according to s

Construction for Domestic Comme

During the past year numer

Commission for aid in the con

vessels to engage in commerce 

mission was advised by the 

vessels proposed might be of 

felt that the efforts of the Co

posal should be directed prim

chant fleet engaged in foreign 

least none of the Commissios

struction of vessels for domest

A corollary to the problem 

American merchant marine is 

satisfactory seagoing personn

construction private operators 

situation Chaotic labor con

crews sitdown and quick

duties are characteristic of 

discipline on board ship was s

which the refusal of the se

vessel to perform their lawfu

take prompt and decisive a

recommended remedial legisla

the jurisdictional strife now pr

and a more cooperative wo

unions and the ship operators
REPORT OR THE UNITED 

Improvement of Crew Quarters

Hearings held by the Comm

minimum wages minimum ma

conditions and the personal in

missioners disclosed that part 

table to inadequacy of crew qu

the hearings therefore the Co

on crew quarters to inspect and 

each subsidized vessel within th

type of the ship and its expect

the Atlantic coast this comm

presently engaged on the Gu

crew quarters on 45 vessels hav

of the Commission and will be p

operators The cost of alterat

vessel and the total expendi

burden of effecting these chang

the Commission

Establishment of Labor Standards

By a general order dated Octo

minimum manning and minimu

conditions for officers and crew

in this order were the result of e

held at 10 different ports This 

tors and vessel personnel to p

general hearing wss then held i

Sifting all the material offere

ations in type and age of the su

needs of the services in which th

cation of any blanket rules wit

and reasonable working conditi

of the subsidized fleet the Com

tions on the minimum mannin

observed on each ship

The minimum wage scales ado

rates of pay for practically all 

steward sdepartment where the 

make it impossible to set up un

the promulgation of the Comms

able variation in the basic rates 

Atlantic and Gulf Althou hth

it was only fixing minima and r

that the rates established would 

uniform wage floor are importa

provement of employment cond
3 REPORT OF THE UNITED 

for both officers and members o

already inaugurated this prac

attained wide acceptance

Effect of Warlike Activities

While this order was still b

confronted with a request for th

hoard vessels entering zones of 

waters The Commission offer

this problem with the operators 

took the position that the adopt

exceeded its authority As the 

Line was concerned in this matt

for the payment of a cash bonu

on vessels of this line which en

Warlike disturbances in the F

American lines during the sum

or curtailed with a detrimental e

prolonged gravity of the situa

hostile incident eventually led 

to state

Merchant vessels owned by the G

after until further notice be permitt

arms

Proclamation

ammunition

of May

or

I

implements

1937

Any other merchant vessels flying 

port any of the listed articles to Chin

their own risk

The question of applying the Neu

ment policy remaining on a 24hour 

SETTLEMENT OF 

On assumption of office the 

directed its attention was the 

held by 32 steamship companie

issued prescribing regulations 

justment of the oceanmail co

contracts and the essentiality o

taken by the Commission staf

a question as to the proper int

some cases the classification o

Department apparently differe

In other cases ships had been c

by the contractor without prop

and many other problems of co

mission that the settlement of 

the adjustment of many confli
REPORT OF THE UNITED S

tractors and the Government 

tractors on February 1 that it 

payment on all voyages begun a

tract in question was adjusted w

accrued on voyages after that da

in arriving at a settlement

Preliminary conferences were 

the contractors by the tempora

nent Commission took office in 

borrow the services of 40 attorne

mental agencies in order to com

June 30 1937 the termination d

of 1936 This group as well a

to work on contract adjustment

of the General Counsel

representatives

Many claims were

in negotiating

set forth by

included a claim of 852 000 

would have been paid operators 

continued in force until their ex

asserted in the aggregate of 20

arising from reduction in mail p

tution of ships construction an

minor items In offset to thes

question of the validity of the co

failure to complete voyages and 

undertake construction of new ve

On June 30 1937 the Commi

settlements with 23 companies 

These agreements providing fo

were settled at a net cost to the G

A settlement agreement provi

the contractor and the Governme

Steamship Corporation on July 

tractor sclaims arising out of 

agreed to pay the Waterman S

to pay compensation for three 

1936 and 1937 at the rate of 250 

Pursuant to the terns of sect

the settlement agreements exec

mitted to the Attorney Genera

notified the Commission on Sep

with the settlement agreements 

not appeal them to the Court of 
Name of company

American Diamond Lines Inc 

American Mail Line Ltd 

American Beanie Line Inc 

Ameritnn South African Line Inc 

A rnenean West African Line Inc 

Atlantic Caribbean Stearn Navigation Co 

Baltimore Mail Steamship Co 

Colombian Steamship Co Inc 

Eastern Steamship Lines Inc 

Esp rt i s ship Corpuratwn 

Grace interests

Grace Steamship Co 

Panama Mail Steamship Co 

Gulf t acific Mail Line Ltd 

Lykes art rests

Lykes Eros Steamship Cow Inc 

Lykes Bros Ripley Steamship Co 

Tampa Interocean Steamship Co 

Mississippi Shipping Co Inc 

New York Cuba Mall Shamshlp Go 

Oceanic Oriental Navigation Co 

Oceanic Steamship Co 

Pacific Argentine trawl Line Inc 

South Atlantic Steamship Co 

States Steamship Co 

United States Lines Inc 

Waterman Steamship Corporation 

Total 

10 REPORT OF THE UNITED 

On September 24 1937 the 

with the American Mail Line 

the oceanmail contract cover

of claims

A full tabulation of all ocea

the following table

NoseNo payment has been made by the 

contractor ether than as indicated in this statem

and Government claims have been released w

The remaining contracts not 

by the Dollar Steamship Line

Gulf Mail Line United Fruit C

Corporation

Adjustment of the Munson 

unusual difficulties because the 

reorganization under section 77

of years and the service is oper

court Protracted negotiation

bring about an adjustment of 

the creditors the reorganizatio

Settlement of the oceanmail 

Lines Inc Ltd was deferred 

to comply with the Commissios

tion concerning the operation
REPORT OF THE UNITED 

Later negotiations were further 

company attributable to warlik

the Far East This situation be

on October 8 1937 took the pr

mail payments for voyages com

1937 to the contractor smortg

mission Throughout the past 

close touch with the Dollar com

bers of the staff were sent to 

satisfactory basis for a settleme

of an operating differential subs

negotiations is predicated on a 

companies to provide a firmer fi

sary new construction

The tinted Fruit Co signifie

differential subsidy but claimed 

its oceanmail contracts becau

differential on the six vessels 

Frequent conferences with repr

yet failed to bring about a mut

might be considered just com

cancellation of the mail contract

As there was some doubt con

lines for a longterm subsidy a 

ment agreements with these ope

right to rescind the release of 

ment at any time prior to Janu

range operating subsidy agreem

tractor chose to exercise his rig

he should return all or part of th

the oceanmail contract for voy

1937 The contractor and the 

status existing before the settlem

OPERATINGDIFFERENT

By the terms of the Merchant 

who filed an application for ad

likewise had the right to seek t

subsidy agreement Conseque

representatives of the Commiss

operating differential subsidy as 

involved As the permanent Co

before the date fixed by Congres

payments it determined that no 

ment would be executed for mor

38940 383
12 REPORT OF THE UNITED 

serious doubt in many cases as 

for a longterm contract becau

sound financial structure to div

flag affiliations or to compl

Furthermore the Commission 

the practical application of the 

long term contracts

Temporary Agreements

Temporary operatingsubsid

my 1 1937 with 16 steamsh

24 1937 an operadifferesubs

the American Mail Line Ltd 

number of tlxe subsidized fleet to 

for a period of 6 months the o

pay on a contract basis and th

Estimated subsidies for 6 months u

a

1 Actual amount earned for carrying mail at u

Supplemental Applications

Many supplemental applicat

for waivers exceptions or con

803 804 805 and other provis

time between the conclusion o

tracts and their effective date 

thorough survey and study of e

that the Government srights 

term of these agreements by th

qualifications in each case 

company sforeignflag affiliatio

the company but also to Ame

American Diamond Lines Inc

American Mail Line Ltd

American Scantic Line Inc

American South African Line Inc

Atlantic Caribbean Steam Navigation Co

Baltimore Mail Steamship Co

Colombian Steamship Co Inc

Eastern Steamship Lines Inc

Export Steamship Corporation The

Grace Line Inc

Lykes Bros group

Mississippi Shipping Co Inc

New York Cuba Mail Steamship Co

Oceanic Steamship Ce The

Pacific Argentine Brazil Line Inc

South Atlantic Steamship Co

United States Lines Inc

Total

12 REPORT OF THE UNITED 

serious doubt in many cases as 

for a longterm contract becau

sound financial structure to div

flag affiliations or to compl

Furthermore the Commission 

the practical application of the 

long term contracts

Temporary Agreements

Temporary operatingsubsid

my 1 1937 with 16 steamsh

24 1937 an operadifferesubs

the American Mail Line Ltd 

number of tlxe subsidized fleet to 

for a period of 6 months the o

pay on a contract basis and th

Estimated subsidies for 6 months u

a

1 Actual amount earned for carrying mail at u

Supplemental Applications

Many supplemental applicat

for waivers exceptions or con

803 804 805 and other provis

time between the conclusion o

tracts and their effective date 

thorough survey and study of e

that the Government srights 

term of these agreements by th

qualifications in each case 

company sforeignflag affiliatio

the company but also to Ame
REPORT OF THE UNITED S

Section 804 was waived provisio

would be paid unless the foreign

or the Commission upon forma

waived the provisions of Sect 8

therein contained In other cas

mission to use subsidiary compan

repair work on the ground of 

application was granted on cond

benefit of the operator thus beco

the books of the affiliated compa

the Commission

Development of LongRange Subsidy P

Having approved 6month su

was faced with the necessity of 

based on its observation of the wo

and on various studies conducted 

temporary subsidy agreement con

operator should submit to the Co

a plan for the replacement of all ve

embrace in this report full detail

vessel as well as the method prop

The response to this section of 

couraging Many reasons were 

their unwillingness or inability to b

labor conditions high costs restr

cited Subsequent negotiations 

of initiating a smallscale replacem

privately owned lines

At the same time the Commissio

of the foreign commerce of the 

which trade routes were essential 

Marine Act 1936 These studies 

ough in detail and it is the poli

long term subsidy for a route the 

fully determined

As the administration of the s

operators requested the Commissi

items in their longterm subsidy a

to those specified in section 603 b 

tenance repairs not compensated b

of officers and crews Among the 

selves to be at a disadvantage in c

were passenger subsistence sh

protestations were also made for t

sidies to offset aid granted by fore
14 REPORT OF THE UNITED 

depreciation subsidy to comp

contracts where new constru

terms of the 1928 act It w

that in making its computa

American and foreignflag v

operating figures of the lowes

weighted average based upon 

vessels of each foreign compe

The Merchant Marine Act 

foreignflag competition with 

deemed essential for the dev

implies likewise that the ope

obtained by the Commission 

necessary to place American l

tions which the Commission m

necessarily tentative An A

obtained a dominant position 

foreignflag competition Fa

however might el minate it

encroachment of foreignflag 

Another American compan

outside the United States w

competitive foreignflag vesse

in a more extended service 

of appraising the extent of th

the costs of a competitor wh

purchase his supplies in anoth

The study and consideratio

hours of the Commission sti

sibility of fixing operating d

Commission feels that it has 

most complete information 

administration of these agre

exactitude

LongTerm Agreements

Long term operatdifferen

signed with seven steamshi

agreements varies in accorda

struction In the case of lin

term of subsidy is limited to 

period on condition that the 

a replacement program has b

to the Commission

The agreements with these 

cancelation and a reduction o
REPORT OF THE UNITED S

1938 by 25 percent if the opera

contracts stipulated

The seven steamship lines and 

subsidies for the year 1938 are

Grace Steamship Co 

Lykes Bros Ripley Steamship Co In

New York Cuba Mail Steamship Co 

Oceanic Steamship Co 

South Atlantic Steamship Co 

Mississippi Shipping Co 

United States Lines Inc 

Total 

Six other companies have been 

operating differential subsidy ag

sented certain problems which co

the close of the year In order 

without penalty to the operato

shortterm subsidies for the perio

American Scantic Line Inc 

American South African Line Inc 

Colombian Steamship Co Inc 

Eastern Steamship Lines Inc 

Baltimore Mail Steamship Co 

Pacific Argentine Brazil Line Inc 

The temporary operating diffe

with the American flail Line L

expire until March 24 1938 T

upon the outcome of the entire D

Report of Granting Aid to Vessels Ove

Section 605 b of the act requ

Congress the financial aid grante

than 20 years of age One applic

the Cormnission for the period of 

subsidy agreements The findings 

mission in this case are set forth 

Whereas American South African Li

of the act for payment of an operatin

differential subsidy agreement on the 

age and

Whereas American South African L

sentations to the Commission

1 That it will be impossible to mee

eratingdifferential subsidy agreement 

shall be permitted to include among t

additional vessel
16 REPORT OF THE UNITED 

2 That American South African 

vessels are being or will be opera

ports during the period of such agre

3 That the Chincha is the only 

present and future locations of such 

ment can be so substituted

4 That unless this application 

Inc would not enter into the propo

under American South African Li

released

5 That American South African 

service without any subsidy if su

therefore the Commission hereby

Finds That it is in the public in

for the operation of the Chincha a v

differential subsidy agreement and 

Orders That an operating differe

Chincha under the operating differ

EXERCISE OF R

The Merchant Marine Act o

regulatory powers duties an

Acc 1916 the Merchant Mari

Act 1933 and the Merchant 

visions deal with the lawfulne

carriers by water in intersta

practices of those carriers and o

of forwarding or furnishing 

terminal facilities in connect

with the maintenance of tarif

common carriers by water an

and other persons under exem

trust acts

Although the Commission s

foreign commerce is limited c

conference agreements Since 

the antitrust acts when opera

ful examination is made of all a

the minutes of conference acti

of the regulatory provisions o

hibited by section 15 of the S

commerce of the United State

Durirg the past year a co

handling of certain regulatory 

Interstate Commerce Comm

Commission will promptly n

which they have a mutual int

other constantly informed and 
REPORT OF THE UNITED S

under their respective regulatory 

expediting decisions under this arr

Pursuant to section 212 e of 

study was made of the export an

determine whether any discrimi

study indicates that services an

radically different that the articl

as to character and value and 

movement and that no conclusio

can be drawn without a more 

hearing This has not as yet bee

Formal Docket

On October 26 1936 there w

and orinvestigations Subseque

and 13 investigations instituted by 

Hearings were hold in 241 cases 

and distributing charges on int

dealt with the lawfulness of hand

Long Beach and San Diego Ca

mately 8270 000 Hearings were 

the country over a period of 58 

plaints filed by 261 complainant

handling charges on foreign shipm

asked reparation of approximately 

are being conducted

Final reports containing the 

orders necessary to put them int

10 cases were disposed of by order 

when the carriers complied with t

15 proposed reports were issued 

in 9 cases

A number of cases on the doc

ments of rates or major revisions 

eign trades In Docket No 41

the Commission conducted an ex

structure on lumber from the Pac

The decision laid down fundamen

cable not only to the lumber trade 

tion by water Docket No 438 d

Atlantic and Gulf ports Simila

jurisdiction of the Interstate Co

issue The cases were heard joi

both cooperated in their consider

that their jurisdiction is derived 

Docket No 423 Phelps Bro C
18 REPORT OF THE UNITE

conference had refused comp

equal terms with each of th

found that complainant was 

ence thus condemning the di

resulting from the refusal of 

membership The complaina

bership in the conference

Informal Docket

An informal docket is ma

shippers carriers and other p

which arise in the matter of 

tion Many informal compl

adjusted through informal c

and expense incident to forma

Special Docket

In instances where carriers 

transportation are unlawful 

unlawful rates they may est

ments and may make applica

to make reparation to a re

authority must admit that t

are considered the equivalen

thereto admitting the matter

consideration in order to avo

rebates to favored shippers 

applications were granted

Agreements Under Section 15 Sh

Under section 15 of the S

water and other persons sub

approval by the Commission 

plete memorandum of every 

or other person subject to the 

or regulating rates or control

ing competition allocating po

sailings or in any manner prov

ment If such agreements c

unjustly discriminatory or u

the commerce of the United 

the Commission is authorized 

When approved such agreem

the antitrust acts During t

filed This number includes 

proved agreements At the e

effective agreements 123 of wh
REPORT OF THE UNITED S

the latter the parties cooperate in 

regulations for transportation t

uniform and stable rate structure 

between the carriers

Interstate Tariffs

Common carriers by water in i

file their actual rates and other 

state commerce are required to fi

period 10343 tariff schedules we

were rejected for failure to comp

sion rules governing the const

authority granted by the Shippin

permission applications request

effective on short notice or to d

requirements were granted 13 we

granted in part and 9 were withdr

action During the period 28 rat

carriers were protested Of this 

pended suspension was denied in 

four and granted in four and six 

Foreign Tariffs

Under a regulation dated July 

in foreign commerce are required t

showing the rates and charges for 

of property except cargo loaded 

count front points in the contin

Alaska or the Canal Zone to fore

within 30 days from the date t

period 8952 rate filings were mad

addition 2086 filings were made b

ward and other trades

LITIGATION 

The office of the General Cou

duties is charged with the invest

the Commission and subject to 

General with conducting all litig

involved A strenuous effort has 

duce the docket of 291 cases in

pending in the courts on October 

were 52 cases actively defended b

ance underwriters amounting to 

768 400 55 were subsequently a

involving 4658 592 99 were clos
20 REPORT OF THE UNITE

report

61

192 cases remained p

965 352 95

The docket which is heav

includes admiralty cases a g

and the Commission sright 

wartime ship construction in

of cases against bonding com

tor agreements general aver

of cases necessarily conducte

tlements were effected in nine 

the amount received by the 

109 21 Briefs were prepared 

and recommendations were m

The situation with respect 

is similar to that of the cas

length of accumulation Som

year The number of claims 

to 40 Thirtynine claims we

ment of 443 731 30 On Oc

including claims by the Fre

62982 578 3518 claims ag

64291 88 08and 22 claims 

counterclaims against the 

16823 566amounting to 

I

In dealing with the problem

of the Governmentowned fle

down a twofold marine insura

general insurance fund which 

each vessel to the extent of th

est As a corollary measure 

American commercial marine 

step it exempted from the 

marine insurance companies in 

Most of the American parti

can hulls is written for the ac

insurance fund During the 

fund was merged with the ge

insurance reserve set up T

expand its coverage and rece

that the maximum amount to 

advanced from 2500 0to 40

gages held by the Governme

active fleet the general insura
REPORT OF THE UNITED 

pation in the marine insuran

shows the proportion of the ins

the different markets

June 30 1935

Oct 20 1936

Oct 25 1937

The shift in favor of the for

manent trend Various facto

balance The adoption of a de

anticipated expansion of the sy

tive positions of the American 

The fund s percentage repre

owned vessels in the amount 

wrote policies to the extent of

on 41 vessels owned by the C

now in effect represents a dimi

written as of October 26 1936 

percent participation in vessels 

ure is only a little more than 

all American oceangoing vess

that the maintenance of the 

fund will not be detrimental to 

cial market

Replies to the annual questio

indicate that their insurance 

divided between the American a

lifting of the syndicate smaxim

provide a healthy stimulant to 

The direct writings of the sy

strictly owned and controlled 

ro1 000 to foreign compani

actually doing business in the U

lation of topheavy lines reinsu

sion to a reasonable extent but 

of strictly American companies 

the syndicate As u further 

placed both by members of th

made available to the Commis

informed of all arrangements fo
Type 

Sailing vessels 

Yachts and motorboats 

Tugs and barges 

Cargo vessels 

Ferryboats 

Passengercargo 

Tankers 

Total 

22 REPORT OF THE UNITED 

TRANSFER OF VESSEL R

In addition to the activities 

subsidy agreements the Comm

administering various provision

tion 9 of the 1916 Shipping A

required for the transfer to a

all vessels documented in the 

of approval was granted prima

the Commission to prevent se

chant marine Principally beca

markets and the rising price o

increase in the number of applic

and ownership This movem

months The Commission has 

care all applications for sales 

American flag any vessels the tr

to the proper development of 

chart summarizes the transfers 

Statement showing type number gros

U S Maritime Commission for tran

sec 9 Shipping Act 1916 as am

Oct 25 1937 inclusive

Charter

21 vessel chartered to an alien for 1 voyage onl

UNDOCUMENTED VESSELS OF THE 

APPROVED FOR TRANSFER T

Cargo vessels

Grand total

Nationality

German British Creek

Total 

Grand total 
REPORT OY THR UNI rkm 

Statement showing nationality numbe

Maritime Commission for transfer 

Sec 9 Shipping Act 1916 as a

Oct 25 1937 inclusive

Nationality

British Canadian Chinese Dominican Ecuadorian Italian Argentine Cuban French Greek Hungarian Japanese Afeacan Nevorwegian Jugoslavian Nicaraguan Panamanian Peruvian Venezuelan Onionfoundland TotalofSovietSoe alietRepublic Charter to aliens

sales alien w about transfer

Total

During this Bailie period the 

render of the marine documen

involving a change in ownership 

requires consent of the Commiss

Merchant Marine Act 1920

COMMISSI

Operation of GovernmentOwned Lin

The Governmentowned fleet 

when the Commission took off

account

trade routes

by managing

These ships

agents

w

u

1935 The Merchant Main 

to charter or sell these vessels as 

all operation of the Commissis

June 29 1937 At the beginn

its managing agents that no sai

not be completed by that date 

for the charter of these vessels 

Senate Committee on Comme

scheduled for March 1 was post

an amendment to section 704 of 

enacted by the Congress which p

commenced prior to June 29
24 REPORT OIL THE rITrn 

The Commission reissued in

these vessels on May 15 1937 

The managing agents submitted 

services which they respectiv

received from other groups on 

all the bids however revealed t

the terms of the invitation A

remaining bids the Commission 

ance with the provisions of sec

1936 and to negotiate new agre

for the temporary operation of 

favorable for a reoffering

Under the terms of the new ag

to operate the lines for the Cos

basis all profits derived therefro

form of agreement effected a co

over the 1935 agreement unde

fixed payments on account of ov

gross and net revenue without a

As the 1935 agreements had p

without a final settlement the C

payable to each of the managi

routes served by these lines a

during the past year is given in 

America France Line North Atlantic ports to F

American nampton RoadsYankee Line North 

ports and Canada to United Kingdom and Ge

Oriole Lines North Atlantic ports to United K

American Republics Line Atlantic ports to Eas

South America

American Pioneer Line

India 

Australia 

Far East 

Total

Line

The results of operating the 

year 1937 were adversely affec

the industry In spite of a ge

the previous year the net ope

was the direct cost of labor ra

placed in effect on the Commisss

charges were also incurred by ch

overtime and extra personnel 

ices stevedoring cargo handl
REPORT OF THE UNITED 

A further burden which will no

creasing cost of repairs The 

obsolescence of the Government

17 to 19 years of age and their n

with each year Other causes te

the curtailment of maintenance 

ship by members of the crew an

costs in the shipyards

The outlook for the fiscal ye

revenues for the 3month period 

ceeded estimates for the perio

mounted Some savings may b

the purchasing activities of all t

Average gros

America France Lane

American Hampton Roads Yankee Line

Oriole Lines

American Republics Line

American Pioneer Line

The Commission is directed b

to arrange for the employment o

routes in the hands of private o

policy is necessarily contingent 

sale or charter of these vessels a

serve has been determined 

routes indicates the desirability 

them may be discontinued as se

lines or taken over by private 

service No prognostication of 

made until the longrange progr

The Laidup Fleet

On December 26 1936 the 

located at Staten Island N Y 

Md New Orleans La Mobile 

The classification of these vess

conducted by a joint committe

Fleet Corporation the Navy D

ping As none of the vessels h

no underwater hull inspection h

the Commission laid down plans 
26 REPORT OF THE UNITED 

sification of the entire fleet T

cation and location of the ves

26 1936 and October 25 1937

Location

Staten Island N Y

Solomons Island Md

Fort Eustis Va

New Orleans I a

Mobile Ala

Seattle Wash

Grand total

Classification an

Class I

Terms

Oct 26 1936

Class II Class III T

20 32 3 

2 2 

5 40 17 

12 40 7 

3 

4 

39 130 27 

Restricted to domestic operation for 10 year pe

Restricted to domestic operation for 10year p

after conversion to colliers

For conversion to bulk liquid carriers

For scrap in United States

For operation with restrictions from trading 

United States ports for 10 years

For scrapabroad

Eightythree vessels have be

6 vessels were delivered to Lyke

purchase contract dated Febru

service on routes operated by m

the remaining 75 vessels of cl

sufficient commercial or militar

tion were sold between July 6 

conditions surrounding the sale 

the following table

Recap 

Total 

In connection with the foreg

in the laidup fleet it is intere

price paid for vessels purchased 

countries considerable expenditu

proper condition to cross the 

mission which have been care

expenditure in this country t

in foreign operation amounts to 
REPORT OF THE UNITED S

the average amount spent to eq

before being scrapped On th

average expenditure on ships sold 

450 per ton and reaches S30 

vessel will be prolonged

The drydocking program und

resulted in the reclassification o

the summer months hi the State

study was also made of the most s

and class II vessels which the Co

gency use It was found that t

advantageous location for cons

quently 23 vessels in the Staten 

River during the late summer m

conjunction with the Coast Guar

This transfer permits the Comm

Island location and personnel an

the number of men required to m

preservation It is estimated 

fleets and discontinuance of the 

nance charges approximately 20 

now comprising the laid up flee

either foreign or domestic trade b

use in commercial or national em

sequently found to have deteriora

sufficient military or commercial 

tion it will be sold for scrap or o

the laidup fleet off the market de

for new construction

Terminals

One of the functions delegate

prior to the 1936 act is the supe

quired during the era of wartime 

of the Governmentowned fleet 

properties has been made by the C

those which it finds desirable to 

and disposing of the remainder

Like other branches of the sh

on the Commission sfive termin

fluctuates with the movement o

rentals were reduced in recognitio

they have produced very satisfac

contracts may not in all cases refl

sequently the profits of the lesse
28 REPORT OF THE UNITE

considerable variation from th

gross revenue of business Th

of these contracts with the int

equitable to each lessee and re

shipping business

Revenues and expe

Terminal 

50 percent gross revenue minimum renta

2 Maintained by lessee

Boston 

Brooklyn 

Hoboken 

Philadelphia 

Norfolk 

Grapey Island 

Total 

Before seeking any adjustm

wished to be apprised of the 

these properties A detailed 

pendent expert in the field w

the next 5 years A longterm 

on the basis of this report t

arrangements for the lease of 

Surplus Vessel Equipment

The former Merchant Fleet 

Hoboken N J Norfolk Va 

for the storage of navigating 

from Laidup vessels special sh

tity of miscellaneous supplies 

operations of the Government

cost of maintaining these war

reduced number of Governm

operation and the sale of vesse

to be of no commercial or m

mined therefore to minhnize its 

all warehouse stock except ship 

ing gear to equip the vessels re

of the various warehouses has 

has been disposed of during 

of the sales of surplus equipme

vessels is given below
Vessels New York

New Orleans

Total

REPORT OF THE UNITED ST

Reca

Storehouses New York

NeworfolkOrleans

Total

FINANCIAL 

Housing Properties

The Commission has title to va

ing of 17 houses and 16 parcels o

Camden N J Groton Conn an

of these properties revealed that t

to the Commission from the stand

tions for their purchase were issu

the appraised value of the prope

Commission has authorized furth

these properties but in view of 

believed that a ready market ex

Acting on the authority granted 

tion Act the Commission obtained 

known firms of certified public a

the Commission as of April 15 

selected has not yet been comple

made in the accounts it is not p

assets and liabilities of the Comm

year 1937 There are submitted 

and disbursements October 26 

estimate of operating profit and l

to June 30 1937

The principal assets of the Co

deposit in the United States Tre

are the constructionloan notes an

tion loans made under the Mer

amount of 8147 943 62 41almos

a balance outstanding of 8722144

total of shipsales notes receivable 

Approximately2000 were 

tion of constructionloan notes an

mail contracts were settled
30 REPORT OF IHLE CItED 

Statement of collections and disburse

Commission O

Disbursements Foreignoeeao marlconlraet pas nients

General administrative expense

Operations of vessels expense

Reserve fleet expense

Real estate operations repairs and bette

Insurance

D

losses returned premiums etc

isbursed in liquidation of payables a

ocean mailsettlement agreements

Operating differentialsubsidy payments

Miscellaneous

Total

Summary Total appropriation transfers

Total collections

Total appropriation transfers and collec

Total disbursements

Balance

Balance available Funds on deposit 

ury Oct 31 1937

Appropriation transfers to 11 S Mal Rune 

Transfers from 1 S Shipping Board t8 

Fleet Corporation and U S Shippin

reau 

Transfers from Post 011ie Deportm

ocean mail appropriations 

Trans013 from State Depot tment l pe

foreign eurremoes 

Transfers from Department of Comme

9

and binding appropriation f 

raus ers from C S lreorur Greate

Pan Anleriean Exposition appropriati

Total 

Collections

Constructionloan notes receivable 

Ship sales notes receivable 

Miscellaneous notes receivable 

Interest on notes noor able insm3 00 p

Cash payments on sales of vessels 

Sale of other assets 

Operation of vessels revenue 

Real estate rent 

Insurance premit loss recoveries etc 

Receipts in liquidation of reeen aales a

oeeammailsettlement agreements 

Miscellaneous 

Total 
REPORT OF THE UNITED ST

APPE

Consolidation of monthly financial statem

fiscal year 1937Oct 9

ESTIMATED OPERATI

Number of vessels at end of fiscal year

agOPee meat atin N

Freighter s 1935 

Inactive vessels in custody of opera

tionsMaritime Commission 

Miscellaneous revenue and expense

Terminal

Other properties

properties 

Interest earned and other items 

Total 

Reserve fleet expense 

Administrative

Oceanmail contracts

expenee 

Total 

REPORT OF THE UNITED ST

APPE

Consolidation of monthly financial statem

fiscal year 1937Oct 9

ESTIMATED OPERATI

Number of vessels at end of fiscal year

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