Case Name: HELM v. AMERICAN HAWAIIAN S. S. CO.
Court: United States Court of Appeals for the Ninth Circuit
Jurisdiction: United States
Decision Date: 1922-02-06
Citations: 279 F. 72
Docket Number: No. 3675
Parties: HELM v. AMERICAN HAWAIIAN S. S. CO.
Judges: 
Reporter: Federal Reporter
Volume: 279
Pages: 72–76

Head Matter:
HELM v. AMERICAN HAWAIIAN S. S. CO.
(Circuit Court of Appeals, Ninth Circuit.
February 6, 1922.
Rebearing Denied May 8, 1922.)
No. 3675.
Shipping (§=>58(2) — In action for breach of agreement for a charter, plaintiff held required to prove ability and readiness to perform.
Under a contract for the charter by defendant to plaintiff of a steamship, requiring plaintiff to give a satisfactory guaranty for the amount of the hire money, defendant presented to plaintiff for signature a charter party containing a guaranty not in accord with the contract, for which reason plaintiff refused to sign it, and on the next day defendant canceled the contract. Held, in an action for breach of the contract, that to entitle plaintiff to recover it was incumbent on him to prove that he was ready, able, and willing to perform the contract on his part, including the giving of the guaranty provided for therein.
Ross, Circuit Judge, dissenting.
In Error to the District Court of the United States for the Second Division of the Northern. District of California; Frank H. Rudkin, Judge.
Action at law by Frank P. Helm against the American Hawaiian Steamship Company. Judgment for defendant, and plaintiff brings error.
Affirmed.
On February 28, 1916, the plaintiff and the defendant entered into an agreement for a charter from defendant to plaintiff of the steamer Floridian at $115,000 per month for two round trips to the Orient, delivery and redelivery at San Francisco. The agreement contained this provision: “This charter all subject to satisfactory guaranty to the owners for the amount of hire money for the two round trips.” The plaintiff, in suing for damages for alleged Preach of the contract, set forth that on March 3, 1916, the defendant repudiated the contract and refused to place the vessel at the plaintiff’s disposal, that the plaintiff was at all times able, ready, and willing to, and then and there offered to, perform all the conditions in said contract on his part to be performed. The defendant’s answer denied the plaintiff’s allegation of readiness and ability to perform, and offer to perform, and alleged that on March 1 and later the plaintiff stated to the defendant that he was unable and unwilling to furnish to it any guaranty for the hire money of the two round trips of the steamer; that he never at any time did tender to the defendant a satisfactory, or any, guaranty for the hire money of the two round trips, but refused to furnish the same, by reason of which facts the agreement was canceled with the plaintiff’s consent and acquiescence. The jury returned a verdict for the defendant.
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Nathan H. Frank and Irving H. Frank, both of San Francisco, Cal., for plaintiff in error.
Andros & Hengstler and Goodfellow, Eells, Moore & Orrick, all of San Francisco, Cal., for defendant in error.
Before GILBERT, ROSS, and HUNT, Circuit Judges.

Opinion:
GILBERT, Circuit Judge
(after stating the facts as above). On the trial, instead of proving the allegations of his complaint, that he was at all times able, ready, and willing to perform, and offered to perform, the plaintiffs own testimony showed conclusively, not only that he wholly failed to furnish or offer to furnish the guaranty, but that he did not regard the contract as requiring him to furnish a guaranty-in the sum of $525,000, which sum he admitted to be "the amount of the hire money for the two round trips." The evidence showed that what the plaintiff was proposing to do in compliance with his contract to furnish a satisfactory guaranty was to obtain from prospective shippers contracts for shipment of freight on the steamer, and by means of such contracts to obtain for the defendant an indemnity bond from a guaranty company in the sum of $120,000, and to raise cash sufficient to place in escrow for the defendant $115,000, a sum equal to one month's charter hire. It was in evidence that on March 2, 1916, the defendant presented to the plaintiff for signature a charter party, in which was set forth a guaranty to pay the defendant any sums that might be found due it "from charter party from any cause whatsoever arising under the within charter," and that the charter party was rejected by the plaintiff for the reason that "it was not in accord with the contract."
In instructing the jury the court charged as a matter of law that the form of guaranty submitted to the plaintiff was more burdensome than the guaranty provided for in the original contract of the parties, and that the plaintiff was under no obligation to execute it. The court said:
"If you find from a preponderance of the testimony that the plaintiff objected to the form of guaranty when presented to him, and pointed out his objections thereto, and that the defendant insisted upon that particular form of guaranty, and canceled the contract because such form of guaranty was not executed, then in that case I charge you as a matter of law that defendant breached the contract, and the plaintiff is entitled to recover, provided you further find that he was at all times ready, able, and willing to perform the contract on his part. It is incumbent upon the plaintiff to show that he was ready, able, and willing to perform his part of the contract, or more especially to give the guaranty provided for. If lie has failed to establish that fact to your satisfaction by a preponderance of the testimony he cannot recover, because in contemplation of law he suffered no injury."
The plaintiff assigns error to that portion of the instructions so given in which the jury were charged that, in order that the plaintiff might recover, they must find that he was ready and willing to perform the contract, and that it was incumbent upon him to show that .he was thus ready, able, and willing. It is contended that by those portions of the instructions the court erroneously shifted to the plaintiff the burden of proof which rested upon the defendant to prove the plaintiff's inability to perform. But the burden of proof was upon the plaintiff to show his damages. There could be no damage to him from the breach of the contract, unless he was ready, willing, and able to perform upon his part. He recognized that fact in drawing his complaint wherein he alleged his ability and readiness to perform. He wholly failed to prove a tender of a guaranty within the terms of the contract, or to prove his ability to furnish such a guaranty. We find no error, therefore, in the instructions. Wilfley v. New Standard Concentrator Co., 164 Fed. 421, 90 C. C. A. 543; Douglas v. Hustead, 216 Pa. 292, 65 Atl. 670; Mulford v. Central Fire Assur. Society, 25 Colo. App. 527, 139 Pac. 1044.
Error is assigned to the refusal.of the plaintiff's requested instruction that the defendant was bound by the reasons stated in its notice of cancellation of date March 3, 1916, and could not be heard to claim that it had canceled the contradi for the reason that the plaintiff had notified it that he could not comply with the contract, and it is argued that the reason so given for canceling the contract was inconsistent with the defendant's contention that the plaintiff was unable to perform the same, citing the rule that, where a party gives a reason for his conduct touching any matter involved in controversy, he cannot, after litigation is begun, change his ground and put his conduct upon another and different consideration. But we find no such inconsistency in the record. The letter of cancellation of March 3 stated:
"The proposed charterer having failed to comply with conditions within a reasonable time, which time had been extended until 4:30 p. m. to-day, we beg to notify you that our agreement to charter is hereby canceled."
The cancellation notice was not placed upon the ground of the plaintiff's refusal to sign a proffered charter party, but upon the ground of his failure to comply with- the contract within a reasonable time. We find no error.
The judgment is affirmed.