Court Opinion

ID: 8809352
Source: CourtListenerOpinion
Date Created: 2022-11-26 14:58:16.585954+00
Date Added: 2024-06-11T17:04:13.521009
License: Public Domain

LEARNED HAND, District Judge
(dissenting). Under the American rule, prepaid freight, which is not earned till the voyage is com*185pleted, may be recovered back. Griggs v. Austin, 3 Pick. (Mass.) 20, 15 Am. Dec. 175. Hence under our law the claimants must rely wholly upon the clause in the bill oí lading. It must be conceded that in England prepaid freight is now recoverable, even though the ship have never broken ground, but is burned at her pier. Coker v. Limerick S. S. Co., 34 Times Law Reports, 18. We have therefore to determine what meaning to ascribe to language which, like all that used in such documents, is scarcely more than a skeleton of the thought’s body.
Much could be said for the libelant’s position, had the clause merely read “retained irrevocably”; but it did not. We must take the addition as qualifying the meaning by the conditions which it introduces. The loss of the ship is one condition, and it is urged that the other includes every possible contingency in which the ship' is not lost. Read verbally this may be so; yet if one in this way malees the two alternatives logically exhaustive, the result is to give no meaning whatever to the added conditions. They can, I think, hardly have been intended merely as an intensive, and, if they have any qualifying value at all, I see no other so natural as to include contingencies which should frustrate the venture after its inception. At least this, it seems to me, is the most extended meaning which it can have.
So much for mere textual consideration of the language. However, as in all such cases, the meaning of words is best gathered from the purpose that informed them, and that purpose, taken from the standpoint of a fair observer, was to meet the possible difficulties which might arise in the performance of the contract. If a ship breaks ground and is lost, or returns to her port of departure, the shipper has got nothing for his freight. Erom his view it is an injustice that the ship should hold prepaid freight. Yet the ship has performed part of the service, and from its view the prepayment may be taken at least in part as compensation for the service so far performed. The ship has given a part of her time; her loss is actual. There is, therefore, an entirely understandable reason why the shipper should accept the hazard of the voyage once begun. A nicer justice might, it is true, apportion the prepayment to such time as the ship had in fact lost, if the frustration was partial, but there are obvious practical difficulties in such a course.
This, however, is not the case of frustrating a voyage, but a contract, and, looked at from the time when the contract was made, it can hardly be thought that the shipper was to bear, not only the chance of the voyage, but of the contract. Because, if the contract be frustrated before loading the ship has lost nothing, and if the frustration occurred before breaking ground at most nothing beyond detention while loading and discharging. She remains available for carriage during the same period as before. If one construes the clause as justifying her retention of the prepaid freight, she is in effect given two freights for the same period. Such a conclusion can hardly be within the compass of what the shipper would have conceded or the owner demanded, had they been faced with the possibility at the outset. Therefore I think the result was not within the intention of the parties, when in one way or another some construction must be imposed upon a mere outline of *186intent like this. I conclude, therefore, that the clause applies to the voyage only, and that if the voyage be frustrated in limine — that is, before ground broken — it does not entitle the owner to retain the freight.
The authorities, so far as they go, are at least not to the contrary. In The Tornado, 108 U. S. 342, 2 Sup. Ct. 746, 27 L. Ed. 747, the ship was destroyed at her pier, and the owner sued the cargo, demanding freight, because he had not been allowed to complete the voyage in another bottom. The headnote .says that the freight was to be paid upon delivery, but an examination of the record does not bear out the statement. In any event the court decided that the shipper was absolved from further performance on account of the frustration of the voyage in limine. The implication at least was that, had the vessel broken ground, the result might have been different. While it is hard to see. how the owner could in any case have recovered more than damages, that point was not raised, and the case seems to me an authority for the proposition that a frustration in limine puts an end altogether to the contract of affreightment. Now, I suppose no one would contend that the result would be different under the clause at bar if the ship had been burnt. If so, I cannot quite see why the owner should be allowed to keep his unearned freight, and yet under The Tornado, supra, not be allowed to sue because he was'prevented from earning the freight. The Allanwilde (D. C.) 247 Fed. 236, went further than need be here, further perhaps than I should care to go. I have found no other case in point. Prepayment clauses under our law must be construed as intended for security rather than insurance to the owner. I am disposed, therefore, to look narrowly upon a clause like this, which seeks to impose upon a shipper, not only the risks of a voyage, but a gratuity for a voyage never undertaken.
I dissent.