Document: 347 U.S. 409 74 S.Ct. 608 98 L.Ed. 806 MARYLAND CAS. CO. et al.v.CUSHING al. No. 11. Reargued Nov. 10, 12, 1953. Decided April 1954. Mr. Eberhard P. Deutsch, New Orleans, La., for petitioners. James J. Morrison, respondents. Justice FRANKFURTER announced the judgment of Court and an opinion in which REED, JACKSON BURTON join. 1 On evening May 19, 1950, towboat Jane Smith attempting to pass under a bridge over Atchafalaya River Louisiana collided with concrete pier capsized. The owner charterer filed consolidated petitioners admiralty United States District limit their liability provisions 46 U.S.C. §§ 183 186, U.S.C.A. 183, 186.1 having complied procedural requirements Limitation Act, issued injunction prohibiting suit against them elsewhere than limitation proceeding. 2 Subsequently, same Court, plaintiffs below, as representatives five seamen who had been drowned, brought this action underwriters ship.2 Jurisdiction was based on diversity citizenship Jones § 688, 688. For right proceed insurance companies, relied 655 Insurance Code, LSA—R.S. 22:655, authorizes direct 'against insurer within terms limits policy'. 3 two policies sued upon are (1) workmen's compensation employer's policy, amount $10,000, by Maryland Casualty Co. alone is named insured contains special endorsement making its applicable maritime employment; (2) 'protection indemnity' policy $170,000 Home Company York, both named. Both preclude payment anyone until shall have held liable pay damages.3 4 granted motion summary dismissing insurers grounds that statute was, own terms, inapplicable marine insurance, any case application here would 'not only work material prejudice characteristic features general law but also contravene essential purpose expressed Act Congress field already covered Act. Title 46, U.S.C.A.' Cushing v. Texas & Ry. Co., 99 F.Supp. 681, 684. 5 Appeals, relying solely jurisdiction, reversed, holding matter local read too restrictively, question not open here, nothing more permissible regulation authorized McCarran 15 1012, 'conflict feature substantive law, nor remedy peculiar jurisdiction.' 198 F.2d 536, 539. Deeming ruling important proper enforcement we certiorari. 345 902, 73 642, 97 1339. 6 presented petition certiorari whether violate 'the Limited Liability constitutional grant federal government exclusive jurisdiction matters.' We agree Appeals since supports need be drawn jurisdiction. Nor detained petitioners' contention applied claims employed decedents, State conflicts it provide alternative where has prescribed means recovery. Since itself makes available seaman 'at his election,' perceive no conflict between statute. 7 Respondents, other hand, seek derive support reliance from provides 'No construed invalidate, impair, or supersede enacted regulating th business * unless such specifically relates *.' 1012. Suffice say even most cursory reading legislative history enactment clear counteract adverse effect Court's decision South-Eastern Underwriters Association, 322 533, 64 1162, 88 1440, might found insurance. House Report Bill decisive: 8 'It intention legislation clothe power regulate tax beyond they possess prior Supreme Southeastern Association case.' H.R.Rep. 143, 79th Cong., 1st Sess. 3. 9 touched case. In face unequivocal expression congressional meaning, cannot doing something told us intended do. relevant here. 10 This brings governing issue: does enter area withdrawn States? provided comprehensive system adjudicating claims, directly considering operation system, putting one side encroaches body nonstatutory law. Cf. Red. Cross Line Atlantic Fruit 264 109, 44 274, 68 582; Just Chambers, 312 383, 668, 61 687, 85 903. 11 Legislation limiting shipowners' first eancted 1851 assistance American shipowners thereby place favorable position competition world trade. Stat. 635. It event collision mishap, occurring 'without privity knowledge' (including therein charterer), will limited value ship freight pending.4 permits shipowner instituting proceedings all him into concourse tribunal. 12 designed induce heavy financial commitments shipping industry requires mitigating threat multitude suits hazards vast, unlimited result disaster. faithful ultimate statute's words 'in broad popular sense order defeat manifest intent.' Flink Paladini, 279 59, 63, 49 255, 613. Particularly view fact subjected whole scheme scrutiny 1935 1936 personal injury death resulting sinking Morro Castle, did alter those involved must light purposes. sit disposed proceeding apportioning losses. clashes marshalling arising certain causes action. See detailed Admiralty Rules 51—54, 334 864, 28 heart concursus ensure prompt economical disposition controversies there often claimants. benefits bestows were thus described hearings amendments Act: 13 'Under statutes, 1851, different purposes serve; draw court, large accident, heard judge state facts, trial, intelligently of. Suppose big sea comes aboard passenger liner 20 people deck washed up stanchions else, claim ought slowed down, known radio. Those passengers may live anywhere Maine Texas, if you separate laws jurisdictions, just handle accident kind possibly intelligent way. One court line negligent; another third entitled $1,500; next $45,000; nobody knows he is. 14 'So useful like could file bringing claimants trial. Otherwise keep crew off traveling around country years.' Statement Charles S. Haight, representing French Line, Hearings before Committee Merchant Marine Fisheries H.R. 9969, Part 4, 74th 2d 69—70. And commenting sections Bradley purpose: 16 'In promulgating rules referred to, deliberate mode part rights act declared settled definitive decree competent should binding parties interested, protect ship-owners being harassed litigation tribunals. questions statutory First, owners and, secondly, liable, liability—must necessarily decided district case; render conclusive, entire control subject exclusion courts jurisdictions. If investigate at time, come conclusion contrary court; (as happened case,) thwarted rendered ineffective secure benefit statute.' Providence York S.S. Hill Mfg. 109 578, 594—595, 379, 389—390, 617, 27 1038. 17 Direct actions underwriter detract undermine 'complete manycorned controversy'. Hartford Accident Indemnity Southern Pacific 273 207, 216, 47 357, 359, 71 612. ship's company call witnesses proceeding, perhaps diverse forums. Conflicting judgments result. Ultimate recoveries vary proportions contemplated Moreover bear mind shipowner. elaborate notice injured They claimants, favored few, equal footing obtain pro rata share damages. To permit drain away proceeds prejudices victims rely, every reason present claims.5 18 Furthermore, insurers, unable rely denied concursus, likelihood reflect increased costs premiums, passing very class sought benefited short-circuiting effects statute.6 19 addition encroachment concourse, liability. complaints agreement record total $600,000 alleged Thus certainly damages respondents exceed $180,000 sum cover. equaling policies, exonerated further obligation indemnify policies. then whatever stripped protection. How about easily seen assume salvaged finally valued $25,000—the advised stipulation succeed obtaining without exhausting bar additional $25,000 recovery some Yet absence statute, sufficient cover Under these circumstances, extent lose measured protective insurance.7 Without bought $25,000. buy suits, still Thus, require become self-insurers risks sure getting full protection legislation. 'substantially insured,' Keen Overseas Tankship Corp., Cir., 194 515, 518 (L. Hand, J.), sort qualification completely inconsistent 21 1886 called decide hull owner's 'interest' turned City Norwich, 118 468, 1150, 30 134, in. part, narrow interpretation 'interest.' But Bradley, commanding role applying reviewed liability, language illuminating guide here: 22 'Now, construe manner prevent merchant contracting indemnity loss investment, spirit commercial jurisprudence. Why allowed purchase indemnity? Is public policy? That be, equally condemn man himself fire, losses sea, casualties. hold done tends discourage otherwise willing invest money business.' pages 504 505, page 1163. 23 foreshadowed consequences permitting shipowners: form framed (shipowners) themselves. entirely foreign our legislation.' U.S., 24 Of course, wholly apart respect accorded legislation, slow find exercised left room Kelly Washington ex rel. Foss 302 1, 58 87, 82 where, case, evident design can carried out barring action, barred. 25 true establish certainty operate leave indemnification. Judgments satisfy enough vessel worthless, exonerating Or successfully challenged mishap happen 'privity knowledge'.8 26 These elements uncertainty temptation let proceed. Further reasonably rather seeking defense. crucial faced now independently keeps hands actions, draining time anyone. future remains taken critical issue clearly be. Public Workers America (C.I.O.) Mitchell, 330 75, 67 556, 91 754. postpone review gives meaning Albertson Millard, 242, 600, 983. us, point return. Once recovered going after late preserve proceeds. permitted, involve substantial hazard Congress, leaving way impairment challenged. Respect precludes allowance litigation, carries potentiality irreparable infringement inadmissible reached soon get bars suit, anomalous contest actions. 29 'limitation liability' phrase used term art admiralty. misconceive it. disregard proceedings. authorize charterers instituted proceedings, disturbing intrusion harmony uniformity aspect accentuated less ill-defined common incursion considered, well-defined consciously designed, execution established Court. 'If (the Act) administer fairness, giving immunities secured it, encouragement afford operations stated) last importance; administered tight grudging construing clause unfavorably ship-owner, allowing little possible favor, hardly worth trouble enactment. Its efficiency greatly diminished, destroyed, administration hampered interfered various conflicting jurisdictions.' 588—589, 385—386, 31 Accordingly, JACKSON, I reverse reinstate complaints. reasons stated opinion, CLARK agrees permitted impair shipowner's charterer's indemnification, allow adjudicate run course. 32 break deadlock differences enable majority dispose vacate remanded continued completion 33 so ordered. 34 Judgment vacated 35 CLARK, concurring. 36 see necessity invalidating Louisiana's administering avoid 37 admittedly companies; deal encourage investment ships placing knowledge'. Thereafter 1886, recognized coverage damage investment. 'hull insurance' held, interest' vessel. basis owners, latter prevented indemnifying themselves well Here, sustained chargeable damaged recoup through purchased exhausted recoupment impossible. Though Norwich control, think reasoning pertinent; words, it1 itself. Unless afforded opportunity protection, much recognized. 38 expense families deceased seamen' ignore realities Had not, condition, recover sole source claimants' hope hull. motive purchasing public, claims. aided widows orphans creating possibility companies. 'profit' accident. never obligated He 'profits' receive paid. 39 companies Our interest make do interfere Federal concluded discharge paying sum.2 door prosecution remaining insurers' subsequent purse touched. 40 FRANKFURTER'S states cases charterer, forum litigating unreasonable position. sure, arguments insurer. persuasive, opposite feeble, juncture invalidate reasonable aimed protecting charterers. speak insurers. when adopted concerned problems charterer. example, empowered enjoin owner, vessel; mention made enjoining party, e.g., Rule 51. sum, lines interpreting regardless how hold. When close, resolve favor upholding confronted picture twenty odd laws; valid argument situation, Smith, owned resident, plied waters River; befell occurred Louisiana; save resided pending judge. Moreover, secondary beneficiaries foreclose 41 reasons, conclude any, determined. 42 BLACK, whom THE CHIEF JUSTICE, DOUGLAS MINTON concur, dissenting. 43 hit railroad sank River. Five members drowned. Petitioners, Company, previously sold boat's agreeing repay account caused boat. delivered Louisiana. A persons heirs sue drowned crewmen go forward bring passed help wrongs inflicted agents. relief act. Neither understand why feel relieve burden bear. objections urge Fifth Circuit companies' contentions 'over-inflate relatively simple proposition apparent, unreal, technical problems.' affirm judgment. because confused goes back desirable discussed. take objections. I. (a) argue impairs 'maritime contracts.' implication contracts kinds contracts. Art. I, Constitution, forbids obligations contracts, draws distinction. while provision protects states, forbid thereafter made. Munday Wisconsin Trust 252 499, 503, 365, 366, Building Loan Ass'n Blaisdell, 290 398, 54 231, 78 413. Hence issued, contract invalid reason, state's 'direct action' became though written each Life Ins. Cravens, 178 389, 395 400, 962, 965—967, 1116. Farmers' Merchants' Bank Monroe, N.C. Reserve Bank, 262 649, 660, 651, 655, 1157. 45 (b) Article III, Constitution 'The judicial Power extend Cases contended Government supreme affairs denies legislate field. complete denial said Jensen, 244 205, 524, 1086; Knickerbocker Ice Stewart, 253 149, 438, 834. opinions lend doctrine Clause rigid national rejected Red 582. Brandeis speaking absolutely deprive regulations regard attempts modify displace remedial courts. Standard Dredging Corp. Murphy, 319 306, 63 1067, 87 1416. reaffirmed always exercised. regulatory systems throughout country. Gibbons Ogden, Wheat. 23. attempted supplant many aids carrying Cooley Board Wardens, How. 299, 996; Hamilton, 207 133, 52 264; Washington, Foss, 14—16, 94, create liens vessels enforced either admiralty, despite lack 'intricate Lottawanna, Wall. 558, 581, 654. declining lien pointed terminate effectiveness desired control. indefinitely defined area—that involving 391, 693, Except instances falling free relating affairs. Florida due torts waters, states. Here therefore difficult me distinguished Chambers. forbidden these, uniform Indeed, 1870 all. Dunham, 0 90. Prior strong belief No Dunham 1871 concurrent policies.1 advanced long province imperatively it.2 Consequently, enforce once again 'illustrate alacrity adopt statutes granting Workman City, 179 552, 563, 212, 314. 264. equitable aims providing wrongs. behind lies ensuring furnish adequate injured. At commonly able single dollar whenever insolvent judgment-proof. although paid for, remain untouched went unsatisfied. injustice required money. Massachusetts Judicial took lead sustaining type, Chief Rugg suggesting becoming 'snare barren injured.' Lorando Gethro, 228 Mass. 181, 189, 117 N.E. 185, A.L.R. 1374. And, wrote compulsory automobile Taft '* seem whose lives limbs exposed, stipulate saves inure person Mutual Automobile Smart, 267 126, 129—130, 320, 321, 69 538. principle. expresses exists insured. Davies Consolidated Underwriters, 199 La. 459, 475—476, So.2d 351, 357. individual purchases injure. bargain advantageous purchaser satisfied 48 There barrier borders. way, enforced. II. amended, collect profit requiring payments killed. construction far intended. act, matter, thing, loss, damage, forfeiture, done, occasioned, incurred, knowledge vessel, her pending.'3 (Emphasis supplied.) relieves normally imposed employers employees. tort loss. simply turn fund All fund, small fund. ships. neither indicates liabilities. contend, however, somehow compel excess follow merit. 50 appear reimbursement 'deprived insurance.' conceded bar, value—a true, stand dime deferring trial lawsuits. 51 Even given escape word suggests give privileges type expanded 134. rested what concede ship. insist put him, them. vital difference dealt. property. guarantee others insurable ship; lost collected own. believe entitle reduce imposes taking compensate injuries inflicts. is, least wreck injures not. cry today's assure instead (c) said, higher premiums impose ceiling power, understand. searched Act's vain interpretation. 103 years passage discovered preventing raise cost reducing wrecks, prices wreck. Construing oil coal far-fetched down premiums. protests desire indulge presumption validity hard reconcile commendable philosophy use attenuated inferences excuse impairing 53 (d) Despite insistence petitioner barred injury, seems plain real They, shipowner, enjoy generous ground believing indirectly. records debates reports strained Shipowners, group wanted help. (e) above beneficiary seamen. quite specific instructions Congress. 1012(b) 1012(b). unquestionably response commerce power.4 unnaturally squarely teeth plain, normal, everyday used. shows continue had. Courts pointedly 'specifically relates' subject. 'business includes stretch imagination unambiguous Louisiana's. justify emasculation language. mandate. III. 55 expansion date especially inappropriate. Many conditions induced longer prevail. later Congresses, wished aid shipping, subsidies treasury persons.5 really subsidy, cost. significant argued 56 Today's creates unnecessary delay doubt Smith's victims. breadwinners shared served. results led efforts spread industrial accidents disasters laws. Acting consistently trend tried purchased. circumstances humane Seamen traditionally wards increasingly solicitous dangerous work. bent it; 183: '(a) collision, except subsection section, pending.' 186: man, victual, navigate expense, procurement, deemed chapter vessels; pleadings challenging asserting Protection contained following clauses. agreed Assured, shipowners, pay, paid, sums responsibility, claim, demand, and/or expenses, occasioned matters things. *' follows types liable. proviso reads 'Liability hereunder Assured Contract.' Condition G Provides: lie Paragraph I(b) foregoing fixed final Employer consent thereafter.' interpreted N.Y. Transp. Wright, 104, 585. After Castle disaster, 135 $20,000, changed portion $60 per ton. 960, 1479. 183(b)—(e), 183(b—e). applicable, 'seagoing vessels,' excluding towboats 183(f), 183(f). sixth victim prove substantially value. penalized meet judgments. indeed availability depends attention 66—67, 129. at. know valuation less. Certainly, valueless, determine allegation 'privity' 'knowledge' assumption determined, itself, parties. practice primarily contingency testimony Ira A. Campbell Steamship Owners' 4550, 91, 125, 131. assuming knowledge, 1920 'marine operating Section defines include 'authorized write reinsurance 988, 1000, 885(a)(2), 885(a)(2). counsel strongly 124. R.S. 4283, 1479, 183(a), 183(a). Ass'n, 1440. Springer, Amendments Law Limiting St. John's L.Rev. 14; Note, Col.L.Rev. 246.

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