US SUPREME COURT DECISIONS

1. The stipulation of a charter party of a ship to take a cargo of lawful merchandise implies that the articles composing the cargo shall be in such condition, and be put up in such form, that they can be stowed and carried without one part damaging the other.

2. The master of a ship may therefore refuse to take goods offered for shipment if in his honest judgment they are in such condition or of such character that they cannot be carried without injury to the rest of the cargo without violating a charter party containing the condition mentioned.

3. Accordingly, where lard, leaking from casks in which it was packed, was brought to a ship, for shipment under a charter party containing a condition to take "a cargo of lawful merchandise," the hold of which ship was at the time loaded with grain, the master was justified in refusing to receive it in that condition, he being of opinion, in the honest exercise of his judgment, that it could not be carried without injury to the rest of the cargo.

4. The master having refused to receive the lard in its leaking condition unless the charterers of the ship gave him an agreement to hold the ship harmless, and they thereupon having written to him a letter referring to his refusal and requesting him to receive the lard, and agreeing to pay any damages which he or the ship might be subjected to on the discharge of the cargo arising from the stowage of the lard between decks and its running on any other part of the cargo, and upon the receipt of this letter the master having consented to take the lard and having stowed it between decks, and damages having subsequently occurred to the grain in the hold from the leaking of the lard,

Held that the agreement contained in the letter was a modification of the terms of the charter party in respect to the lard, and relieved the ship from the responsibility of safe carriage of the cargo so far as that was affected by the lard, and was equivalent to a stipulation to that effect embodied in the charter party, and that the stipulation, though of no efficacy as between shipper and vessel, was valid as between charterer and owner.

This was an action in personam, brought originally in the District Court for the Southern District of New York by the libellants against the appellants to recover a balance due upon a charter party. The district court rendered a decree dismissing the libel. The circuit court for the district reversed that decree and rendered a decree for the libellants. From this last decree an appeal was taken to this Court.

The charter party was executed in July, 1862, at the City chanrobles.com-red

Page 74 U. S. 317

of New York, in the harbor of which city the ship then lay. The voyage stipulated was to be from New York to Havre, with a cargo of lawful merchandise which the charterers were to provide. The ship was to be tight, stanch, strong, and every way fitted for the voyage. She was to load "under inspection," and to "go consigned to charterers' friends."

The cargo furnished by the charterers consisted principally of grain, lard, and tallow. The grain, which was partly in bulk and partly in bags, was stored in the hold. A portion of the lard was stored between decks. By the leaking of this lard, a part of the wheat in the hold was damaged, and the question was whether the damage should be borne by the owners or the charterers of the ship. It was charged to the ship at Havre, and paid by the consignees, who collected the freight, and its amount was withheld by them from the charter money. The present action was by the owners against the charterers of the ship for the balance thus withheld.

When the lard was brought to the ship to be taken on board, it was leaking from the casks in which it was packed. It appeared to be mostly in a liquid state, and the stevedore having charge of the loading refused without the consent of the master to receive it and store it between decks -- the only part of the vessel not then occupied by merchandise. He was apprehensive that in its liquid state, leaking from the casks, it would penetrate through the deck and damage the wheat in the hold. The master, to whom the matter was referred, also refused to take it, and informed the charterers that he could not receive it unless they gave him an agreement to hold the ship harmless. They thereupon wrote to him a letter stating that they understood he objected to their shipping lard between the decks of the ship, requesting him to receive it, and agreeing to pay any damages which he or the ship might be subjected to on the discharge of the cargo at Havre arising from the stowage of the lard between decks and its running on any other part of the cargo. Upon the receipt of this letter, the master consented to take the lard, and it was stowed between decks. chanrobles.com-red

Page 74 U. S. 318

There were between three and four hundred casks, and the lard was leaking from nearly all of them. The weather was unusually hot during the time the ship was receiving cargo, so that it became necessary to relieve the stevedores by extra men, and on some days they could not work at all. The weather continued warm during the greater part of the voyage, which lasted over a month. Upon the discharge of the cargo, twenty-six casks were found entirely empty and three hundred and twenty-seven partly empty. The decks were covered with lard in a liquid state, being in some places two or three inches deep, which had destroyed the pitch in the seams and rotted the oakum, and had dripped through and injured a large quantity of the wheat in the hold.

There was no dispute as to the extent of the damage thus produced. As already stated, the question was upon whom should the damage fall, the charterers or the owners of the ship.

The consignees of the ship at Havre were designated by the charterers as their friends, pursuant to the stipulations of the charter party, and acted as their agent, and not for the master, in collecting the freight.