CONTINENTAL GRAIN CO. v. BARGE FBL-585

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Argument of Eberhard P. Deutsch

Chief Justice Earl Warren: Number 229, Continental Grain Company, Petitioner, versus Barge FBL-585 et al.

Mr. Deutsch.

Mr. Eberhard P. Deutsch: May it please the Court.

At the very outset, permit me to state that this case involves no mandates.

This was an order entered by the District Court for the transfer of an action and in the same order, brought the case within the new Interlocutory Appeals Act so that the case came to the Court of Appeals on appeal and then here by certiorari.

There is no mandamus status involved.

The proceeding itself involves an action in rem in admiralty instituted on the Southern District of New York of -- in the Eastern District of Louisiana against a vessel present in that district.

The cause of action had arisen in the Western District of Tennessee where the libel in rem could not have been brought but where a companion action at law was pending.

The District Court held that the convenience of parties and witnesses in the interest of justice required it to be transferred to the Western District of Tennessee, rather the right to -- or made the statement that the question involved was one of importance and of doubtful solution and an appeal was accordingly allowed to the Court of Appeals.

That Court affirmed, holding expressly that an action in rem in admiralty maybe transferred to a district "to which the movement consents to an unlimited submission of the cause."

It had been my intention to suggest that very little could be added at this point to what has been said at this bar in the two preceding cases but I am tempted to depart from that original intention a step or two to answer perhaps one or two questions which I think were not answered directly at this bar.

In the first place, the question was asked what would happen, I think Mr. Justice Frankfurter, if the plaintiff had in his pocket a letter granting consent to the filing of an action in a district in which it could not otherwise have been filed, if he had that in his pocket prior to the filing of the action.

Now that, I don't think that question was answered here.

I don't know that I can answer it under the holdings of the Seventh Circuit that would still not be a district in which the action could be filed because they read that clause as stating where it might have been brought in the absence of any assent or waiver from the defendant.

Justice John M. Harlan: But -- and -- and do they go that far?

Mr. Eberhard P. Deutsch: Oh yes, sir.

In exact words, I will read just a -- a couple of lines.

We recognize of course that venue maybe waived under proper circumstances but we do not think it can be waived in a forum in which an action has not and could not have been properly brought.

The -- when Congress provided for the transfer of a case to a district where it might have been brought, it meant the district where plaintiff had a recognized right to bring his case under the Venue Act and that this right was unqualified and absolute not depending upon consent of the defendant, evidenced by waiver, entry of appearance or otherwise.

Justice John M. Harlan: Thank you.

Mr. Eberhard P. Deutsch: And the language in the other --

Justice Felix Frankfurter: Purely, when they tried -- they tried 1404 and as I understood the respondents here, tried 1404 to the statutory -- statutory venue provisions standing by themselves.

Mr. Eberhard P. Deutsch: I think so, yes sir.

The other case, the other Seventh Circuit case which is up here contains similar language, not as strong as that.

Now, with reference to the matter of Josephson, in that case, Judge Magruder held in so many words that even the waiver wasn't necessary once you got the defendant and that as far as I can see with all due deference simply just reads where it might have been brought right out of the statute altogether because the argument which is made “where it might have been brought” by waiver or consent isn't even there anymore.

(Voice Overlap) --

Justice Potter Stewart: I didn't quite under -- I didn't' quite understand what you said, Judge Magruder said in In re Josephson.

Mr. Eberhard P. Deutsch: In In re Josephson and perhaps to avoid any question, let me read two or three lines and then make my comment.

One service of process upon all the defendants has been effectuated in Massachusetts, a transfer order.

Yes, sir.

An order of transfer under Section 1404 (a) sends the case as is to the transferee court with no need of a new service of process upon the defendants after the case reaches the Court in Mexico, in New Mexico.

Therefore, in the case before us, it was probably superfluous that the defendants formally waived any question of personal jurisdiction over them in New Mexico.

In other words --

Justice Potter Stewart: I suppose he could've meant, to me, that the very making of the motion by the defendants constituted a waiver.

Mr. Eberhard P. Deutsch: I don't think so.

I -- I find --

Justice Potter Stewart: Well --

Mr. Eberhard P. Deutsch: Now, we -- we both have to guess in what Judge Magruder meant.

I suppose -- but I understood him to mean this venue in the sense -- and I don't understand it either in that sense, this venue in the sense that the Court would normally have jurisdiction of this kind of an action and it doesn't make any difference whether you can serve in there or not, serve them in your transferor district then transfer your case and pay no attention to the phrase “where it might have been brought”.

Justice Felix Frankfurter: He actually didn't have that case before leaving, Mr. Deutsch?

Mr. Eberhard P. Deutsch: No, sir.

He had a case involving I think a derivative action against some, I think nine of his 14 defendants could've been sued in New Mexico and the other -- I mean in New Mexico, the other five could not, could be sued only in Massachusetts.

But be that as it may, the motion may necessarily import by implication a waiver.

In our case, the motion to transfer says nothing whatever on the subject, just a motion to transfer, period.

There is no waiver, no express waiver of any kind in this case.

Now this, bare in mind, is an action in rem in admiralty.

We submit of course that affirmance of the two preceding cases necessarily reverses ours, not without regardless the difference in the type of proceeding but we also submit and that is the only further point to which I will address myself that even should those cases be reversed, this case from the Fifth Circuit must be reversed because of the difference in the nature of the proceeding.

One of the arguments made by the respondent in this Court is that the admiralty court has an inherent power independently of the statute and under Rule 44 of the Admiralty Rules of this Court to effect such a transfer.

We submit that no such power exist certainly in contravention of the specific provisions of the statute dealing with “Any civil action which it has been held and which clearly includes admiralty causes.”

A proceeding in rem maybe instituted only in the district in which the race can be found.

We do submit that that approaches a jurisdictional -- if it does not enter the field of a jurisdictional requirement as opposed to one of venue.

It is a proceeding in rem as such only within the district in which the race may lie.

In admiralty, such a proceeding maybe brought against the vessel even though no personal action would lie against the owner of the vessel, as for instance, in cases of non-contract salvage, in compulsory pilot cases, in cases of bareboat charters modernly, in cases in which a vessel has been transferred and the lien follows the vessel against the vessel but not against the new owner.

In such a proceeding, the jurisdiction of the Court is not personal over the claimant.

He is merely a sort of ancillary party.

He's not actually a party to the litigation, no personal judgment can be rendered against him.

He merely comes in and claims his vessel if he files a bond.

That bond stands in place of the vessel but no personal action maybe rendered against the claimant except of course under the bond if he gives one and signs it.

The claimant under vessel therefore, we submit only this, may not move under Section 1404 (a) to transfer because his motion in a sense is not -- could not even constitute a waiver in behalf of the vessel.

He is not a party to the litigation and he cannot constitute the district to which a removal is sought one in which the action might have been brought because that applies only to one in which the race is to be found.

Justice Charles E. Whittaker: Is -- for my information, tell me please, is that liberally is settled, that the owner who comes in and signs his principals of bond just to release the boat is not a party to that libel suit, is not thereby made a party?

Mr. Eberhard P. Deutsch: He is not thereby made a party.

His only liability then is on the bond but not in the original proceeding which continues against the vessel or the bond in rem.

He is not an actual party.

Now, it's a tremendously interesting question and perhaps I should go into it a little bit.

There, the case is unusual.

Two cases of this Court upheld, one involving a fire statute which limits the liability of the owner in case of fire on a vessel under certain circumstances.

A contention was made, the vessel does not have that immunity which is granted by statute to the owner of the vessel and this Court has held that doesn't make sense.

The vessel does have the same immunity as the owner.

The same thing applies to the limitation of liability which is a sort of bankruptcy statute under which the owner of a vessel may limit his liability to the value of the vessel after the accident.

In those cases, he files his petition for limitation.

He puts up a bond for that value and the vessel is released and he then repairs the vessel and an action was brought against the vessel as repaired stating the limitation does not apply to the vessel, only to the owner and this Court said that is talking in riddles and doesn't make sense.

In the third case, Boyd I think, and it is another case in this Court and that did not involve admiralty but it involved an action in rem, Boyd versus the United States.

That was a forfeiture condemnation proceeding in rem against merchandise.

The United States on seizing that property sought to require the owner of the property to bring his books and records in the Court from which they would get certain information.

He pleaded the Fifth Amendment and the Government said, “Well, this is not an action against you, it's an action in rem.”

And they held that nevertheless, he was entitled to that defense and that would be carrying the doctrine too far.

Now, those are the three cases in this Court that tie in, let us say, the owner with the race in such an action.

But it -- there isn't any question that the action in rem is different from an action in personam despite the fact that such distinctions or analogies as the case maybe have been made.

Justice Felix Frankfurter: Are those -- all the three cases involved general considerations of the policy which were rendered applicable not because there was an identification between the owner and the vessel --

Mr. Eberhard P. Deutsch: True.

Justice Felix Frankfurter: -- but because the policy also apply --

Mr. Eberhard P. Deutsch: Of course, what this Court says is --

Justice Felix Frankfurter: (Voice Overlap) together.

Mr. Eberhard P. Deutsch: -- is (Inaudible)

Justice Felix Frankfurter: Well, all I'm suggesting is that the respectable documents.

Mr. Eberhard P. Deutsch: Right.

I concur.

Now, I might -- such one little further point.

Justice Potter Stewart: Before you leave that, I just --

Mr. Eberhard P. Deutsch: Surely.

Justice Potter Stewart: -- want to be sure I understand what you're telling us.

Take the case of a -- of a vessel plying Mississippi River, the Ohio, Mississippi River system up and down.

It's part of the New Orleans.

Now that vessel owes -- that the nature of things likely to be in a different federal judicial district everyday isn't like -- and as the -- does the question of where a suit maybe brought in rem depend exclusively on -- where the vessel happens to be at -- at a moment in time?

Mr. Eberhard P. Deutsch: At -- well, now that also is not an absolute.

The rule of this Court, the Admiralty Rule does say the action is to be brought in the district which the race is to be found.

Justice Potter Stewart: Yes.

Justice Charles E. Whittaker: Well, it is in navigable -- would have been physical control of a tangible thing?

Mr. Eberhard P. Deutsch: No question at all, and this rule makes that statement.

But -- and you -- I suppose we must recognize practice, in universal practice, an accepted custom even in matters of jurisdiction I suppose.

But these actions are brought with the statement the vessel is now or will be during the pendency of this action within the jurisdiction of this Court.

That is the usual allegation and that is accepted.

There are decisions.

First, that the vessel need not be seized, that the bond maybe filed and take the place of the vessel and perfect the jurisdiction court even if there's no actual seizure.

And there are two or three District Court cases in which it is stated that the vessel need not even be in the district, if the bond is filed, it becomes in effect the race.

There is no appellate decision to that effect.

Justice Potter Stewart: This is a -- therefore, sort of conferring jurisdiction by consent of the defendants, isn't that it?

Mr. Eberhard P. Deutsch: I don't think there's any -- well, I would say by consent of both parties.

Justice Potter Stewart: Of both parties.

Mr. Eberhard P. Deutsch: I thought --

Justice Felix Frankfurter: Well, the bond is deemed to be in place of -- the bond is -- is identified with the vessel.

Mr. Eberhard P. Deutsch: Right.

Justice Felix Frankfurter: Fulfilling the function of what seizure of the vessel it dealt with.

Mr. Eberhard P. Deutsch: Right.

Justice Potter Stewart: But until or unless the vessel itself were actually subjected, there would be no requirement on the defendant to file a bond.

Mr. Eberhard P. Deutsch: None whatever and that is very frequently the case.

Now, take the case -- all this is -- this is partly been discussed before here.

But in this connection, becomes more interesting perhaps, the Internatio-Rotterdam case that has been mentioned at this bar.

Now, that was a suit in rem filed in New York with the usual statement that I made is now or will be during the pendency of this action, et cetera.

The vessel didn't show up in New York but she showed up as I recall it in Philadelphia.

The libelant then went to the judge in New York and said, “Please, I move to transfer this case to Philadelphia where the vessel actually is.”

And that is a jurisdiction in which the action might have been brought.

Now, the vessel is there, perhaps might have been brought before on the assumption that she would come there.

The question was raised but the judge doesn't have the power to sign the order of transfer since he never got jurisdiction, the case goes the vessel and never in New York in the first place.

Justice Potter Stewart: No bond was filed in New York?

Mr. Eberhard P. Deutsch: No bond was filed in New York but the judge did affect the transfer and the transfer was upheld and that was the status of the case as far as it involves the situation.

In other words, there are cases of this sort which have arisen, and that is of course why it's so important for this Court to consider this whole issue as it arises in these three cases.

And --

Justice Felix Frankfurter: Mr. Deutsch, am I wrong that -- is my recollection treacherous, New York is often arrayed between practice of filing a bond, knowing that the suit will be brought although the vessel is physically never seen?

Mr. Eberhard P. Deutsch: We are guilty of that in --

Justice Felix Frankfurter: If indeed --

Mr. Eberhard P. Deutsch: -- more places than New York --

Justice Felix Frankfurter: Alright.

Mr. Eberhard P. Deutsch: -- for ratio, I may say it --

Justice Felix Frankfurter: And my knowledge is limited --

Mr. Eberhard P. Deutsch: And that is universal.

Justice Felix Frankfurter: -- in the local area.

Mr. Eberhard P. Deutsch: That is universal practice for parties to get together and arrange for a convenient jurisdiction by the filing of bond, right or wrong that's done.

Justice Felix Frankfurter: Surely, I think been done out of time.

And my -- I'm out of -- mind in New York which has a little admiralty purpose.

Mr. Eberhard P. Deutsch: And of course, the New Orleans is the great part of the world.

[Laughter]

Why -- Mr. Justice Frankfurter, you asked some questions about legislative history and I would like to touch on those for about two moments.

It -- it was mentioned and I'm not quite sure why but the most significant factor in the legislative history of Section 1404 (a) is a reviser's note which says this is based on the doctrine of forum non conveniens.

This Court has held that that is too narrow, that the discretion may be broadened over what it was on the -- maybe broadened under this statute over what it was before as to what constitutes convenience of parties and witnesses in the interest of justice.

I might mention perhaps as related to the question of legislative history, the following subsection of that statute 1404 (b).

It throws some light on the meaning to me of 1404 (a).

In the first place, it states that the District Court may transfer an action in its discretion.

Now that is without any question of interest of justice, convenience of parties and so on from one division to another division within the same district and then it goes on and has this rather interesting sentence.

“Transfer of proceedings in rem brought by or on behalf of the United States maybe transferred under this Section without the consent of the United States where all other parties request transfer.

Now, it -- it doesn't necessarily clarify the preceding section but it does throw some light on it.

In other words, if the United States is a party to a proceeding in rem, you may transfer from one division to another without the consent of the United States.

We submit that you cannot transfer at least without the consent of all parties in rem from one district to another.

Justice Felix Frankfurter: That is a clear indication and I'd overlooked the -- that -- that the transfer maybe made by the -- on the motion of the plaintiff, doesn't it?

Mr. Eberhard P. Deutsch: On motion of either party, or I suppose ex proprio motu.

Justice Felix Frankfurter: That is -- plainly, that is -- plainly, that allows the plaintiff to move, doesn't it? What you've just read, Mr. Deutsch.

If the United States is a party, then the United States maybe a party under the Vessels Act by a plaintiff.

Mr. Eberhard P. Deutsch: Of course, the United States could be a --

Justice Felix Frankfurter: A party (Voice Overlap) --

Mr. Eberhard P. Deutsch: -- a plaintiff.

Justice Felix Frankfurter: Yes.

The United States could be a plaintiff, yes.

Mr. Eberhard P. Deutsch: But it could not be -- then of course (Voice Overlap) the situation would not apply because it says without its concern.

Justice Felix Frankfurter: The other way around, shows that the -- otherwise have no function at all?

Mr. Eberhard P. Deutsch: None whatever, sir.

But we submit that the -- the action cannot be transferred over the protest, let us say, of the vessel to another district in which the vessel could not have been found.

That is a question of jurisdiction rather than a venue in the in the personam actions which have been discussed to you.

Chief Justice Earl Warren: Mr. Matthews.

Argument of George B. Matthews

Mr. George B. Matthews: Mr. Chief Justice and may it please the Court.

I think the fundamental purpose of this appeal is to determine and to effectuate in some manner the purpose of the transfer statute whether it'd be in a patent case, a diversity case or an admiralty case.

Now, certainly, the purpose of the statute is not questionable.

It was, I'm sure, to save time and expense and to promote the efficient administration of our judicial system.

How to achieve this purpose is obviously questionable in view of these appeals.

I would like to address myself first to the question of ambiguity of the transfer statute.

It has been suggested in the Paramount-Rodney case and I think clearly implied in the Karachi case that Mr. Deutsch just mentioned in the Fourth Circuit that the word “brought” means simply filed in a court that has jurisdiction of the subject matter, nothing more.

That is that you need not be able to maintain the action.

Thus, in the Karachi case, a suit was filed in New York for the obvious purpose of interrupting the one year limitation under the Carriage of Goods by Sea Act.

The allegation account that Mr. Deutsch mentioned was made that the vessel would be within the jurisdiction of the Court.

The vessel in fact never was on learning that you would call at Baltimore, the motion to transfer was made.

Judge Parker in the course of his opinion pointed out first that the filing of the suit in New York interrupted proscription.

That is, the Court had come -- the court was a court of competent jurisdiction and therefore, the filing of the suit even without (Inaudible) of process within the year was sufficient to interrupt proscription.

He further said that clearly, the Court had jurisdiction over the subject matter and therefore powered to any -- any necessary orders to maintain the litigation.

This must -- this evidence is, one, interpretation of the word “brought” in the statute.

Other cases including Judge Whittaker's opinion in the General Electric case, apparently take the position that the word “brought” means filed at a time when the Court has power to issue process and in other words, power to achieve or file adjudication of the case.

So there, we have two clearly divergent ideas.

Secondly, we have the time problem which has been mentioned here before and to further confound that time problem or I think everyone agrees that the words “might have been brought” not everyone certainly, but Mr. King was the last one that suggested it, refer to some time in the past.

Now, in this particular case, the accident happened in Memphis, Tennessee while our barge is being loaded by the -- with the petitioner's grain, the barge sank in Memphis.

The grain was removed by sailboats, the barge was raised and she remained in Memphis.

According to the record, for a week or more after the sinking, now, might not this action have been brought in Memphis and I do not intend to make a play on words.

But the barge was there, subject to the process of the Memphis Court at a time prior to the filing of this case.

Justice Charles E. Whittaker: You say, “might not this action.”

Do you really not mean “might not an action?

Mr. George B. Matthews: No sir, I mean an action by the cargo owner.

Justice Charles E. Whittaker: Yes.

Mr. George B. Matthews: Yes.

Justice Charles E. Whittaker: Yes.

But the question of whether this action was filed in a later time when the barge has been removed from that place.

Mr. George B. Matthews: Exactly and that -- that is what poses the problem in any admiralty case, Mr. Justice Whittaker.

If our opponents are right, this statute is emasculated, because there is only one jurisdiction.

And if they are right, you can never transfer.

That can't be the purpose of the statute.

Your Honors have recognized in connection with limitation --

Justice Hugo L. Black: Would you explain that --

Mr. George B. Matthews: Sir?

Justice Hugo L. Black: -- would you explain what -- precisely what you mean by that?

Mr. George B. Matthews: Oh very well, Mr. Justice Black.

The contention is made here that in an in rem proceeding in admiralty, the only just -- possible jurisdiction is that in which the vessel is at the time the suit is filed.

In other words, there is never any other form.

Now, if the further contention that you have to have on alternate forum or a transferee forum at the time the -- the instant action is filed, that can't be because the vessel can't be in two places at one time.

Justice Felix Frankfurter: Well, that wouldn't -- Mr. Matthews, without -- without commenting on the validity of your argument of the -- of the conclusion, but the argument doesn't emasculate the statute.

It merely says that with reference to admiralty, in rem proceedings, you're restricted to where the vessel is at the time that the -- monition is -- is without or whatever the he technical phrase is.

Mr. George B. Matthews: Well, Mr. Justice Frankfurter, I -- I've limited -- I meant to limit the emasculation to an admiralty in a match --

Justice Felix Frankfurter: Then that is an in rem case, yes.

Mr. George B. Matthews: Correct.

And insofar as that action is concerned, you could never have a transfer under our opponent's theory.

Justice Felix Frankfurter: And that -- and that's the implication of your argument is, it might have been -- if that resulted in admiralty, we've got to reexamine as to what might have been needed?

Mr. George B. Matthews: Correct, sir.

Justice Charles E. Whittaker: That would be the case, I take it in every situation if the petitioner is right -- well, the action was one of a local character, an action in rem, isn't it?

Not because to admiralty, but in every case where the action is more theory.

Mr. George B. Matthews: I'm -- I'm not clear as to the use of the words “local character”, in rem, yes.

Justice Charles E. Whittaker: What was the (Voice Overlap) --

Mr. George B. Matthews: Yes, sir.

That would be the case.

Justice Potter Stewart: Take -- take an action involving a land.

To acquire title (Voice Overlap) --

Mr. George B. Matthews: Well, I don't think so.

Justice Potter Stewart: -- land doesn't move around.

Mr. George B. Matthews: That's correct and this Court has held I think that if -- I think was the case in this Court that a dismissal of an action involving land in, say, West Virginia brought in Ohio on the Court's own motion was from, even though the defendant raise no objection.

That was --

Justice Potter Stewart: I did -- I didn't quite --

Mr. George B. Matthews: Ellen -- excuse me.

Justice Potter Stewart: Excuse me, go ahead.

Mr. George B. Matthews: Ellenwood versus Marietta Chair Company, 158 U.S. 105.

Justice William J. Brennan: I'm sorry.

I didn't catch the point of that when you made it.

Mr. George B. Matthews: The point?

Justice William J. Brennan: Yes.

Mr. George B. Matthews: I was simply agreeing with Judge -- Mr. Justice Stewart that this Court has held that the dismissal of an action involving West Virginia land brought in Ohio by an Ohio judge on his own motion was the problem.

Justice William J. Brennan: He has no jurisdiction.

Mr. George B. Matthews: Without any suggestion of dismissal on the part of the defendant.

Now, I -- Your Honors have recognized the need for a transfer for convenience in admiralty cases and particularly in limitation of liability proceedings.

For example, Rule 54 provides that in the -- that's the venue rule, provides that a limitation proceeding maybe transferred to any district, not one word could have been brought but to any district for convenience of the parties, not for convenience of the witnesses, not in the interest of justice but only for convenience of the parties.

Now, Admiralty Rule 54, may it please the Court, provides that in all suits in admiralty, in all cases not provided for by these rules by statute, the District Court, to regulate their practice in such a manner as they deem most expedient for the due administration of justice.

We submit to the Court that not only is this motion in the instant case or rather this transfer in the instant case justified under the transfer statute of the Judicial Code, but it is also justified under Admiralty Rule 44 adopted by this Court.

That rule as well as the others were adopted pursuant to an Act of 1842 empowering the Court to adopt rules to -- to adopt rules regulating the practice and -- in equity and admiralty matters before the Circuit Courts and the District Courts.

A very interesting case came up under that Act and the rules adopted by the Court and that was the steamer, St. Lawrence.

The Court had adopted a rule, Number 12, which authorize in rem process against a vessel, although the -- the admiralty law gave no maritime lien provided that the homeport of the vessel or rather state law of the homeport gave a lien for repairs performed in the homeport.

The Admiralty Rule then being that there was no maritime lien for repairs and supplies performed as given in the homeport.

The Court held that that rule was valid, that it was not an extension of jurisdiction although it did authorize an in rem process and of seizure where non-existed under the maritime law, but that it was merely a rule regulating practice before the Court.

Now, certainly, a transfer of this action is nothing more than a regulation of the practice or administration of the District Courts.

The -- if -- if again our opponents are correct and there can never be a transfer in an in rem action in admiralty, the -- and certainly, those cases must arise for the convenience of the parties and witnesses in the interest of justice would be served, the only way to achieve it then would be pursuant -- excuse me -- to Rule 44.

And we suggest to the Court that that is a problem.

Now, with regard to the question of the personification of a vessel, I have rather a number of cases as I'm sure that people have and I am frankly confessed that I'm somewhat misdefined.

They say that a -- on offending vessel is a juridical person entitled to be proceeded against in rem.

But what happens where the owner is not in (Inaudible) the vessel doesn't defend the litigation.

The vessel doesn't pay and again in the case of (Inaudible)

The vessel doesn't pay the decree.

The vessel doesn't post a bond and certainly, the claimant of any vessel is a very much interested party to any litigation.

He does not simply come in and say, “I claim the vessel and I put up a bond and I will await your decree.”

He comes in and files a claim as we did here saying that he claims the said barge's owner and prays to be permitted to defend.

That is the claimant's interest.

He is the owner of the vessel.

He has a proprietary interest in it and as this Court said in the Boyd case mentioned by Mr. Deutsch, the vessel doesn't pay the claimant, the owner does.

Now, another interesting case along those lines is the decision of Judge Learned Hand in Burns Brothers Transportation Company versus the Central Railroad of New Jersey which will indicate the fact that at least in the Second Circuit, the personification theory has gotten somewhat out of vote.

In that case, Burns Brothers sued for barge damage caused by a collision with a car float belonging to the Central Railroad of New Jersey.

The car float, when it had gone adrift was in the possession of the -- or Long Island Railroad.

The suits were filed in personam only.

The time of trial, the central was in reorganization and the trial of course did not proceed against that road.

A decree of sole fault was entered against the Long Island.

When they went around to collect a decree, the Long Island was in reorganization.

The libelant then had the idea that he would file an in rem suit against the car float which he did.

Now, what I say to this Court now was dicta, for a reason I will mention but Judge Learned Hand there held that the pry in personam decrees were bars to the -- in present in rem action.

And he said, “Disputes arise between human beings not inanimate things and would be absurd to give the beaten party another chance because on second trial, he appears as a claimant to a vessel that is and can be nothing but the measure of his stake in the controversy.”

He then went on however to permit the suit because at the time the first action was filed, seizure, in rem seizure of the car float was prohibited pursuant to an order in the reorganization proceedings.

Justice Potter Stewart: What you're telling us is, as I understand it then, that while there is an ancient history which seemed to give personifications of the vessels that an actual present practice does amounts to no more and no less than getting jurisdiction by attachment of personal property in ordinary -- ordinary lawsuit.

Mr. George B. Matthews: Not only jurisdiction, Mr. Justice Stewart, but security which I think is the main purpose.

Justice Potter Stewart: Well, yes.

Mr. George B. Matthews: The -- certainly, jurisdiction but why in this case where the acting -- New Orleans action was filed not only in personam which was not mentioned in the opening argument but in rem.

No security was needed.

Nothing was needed to enforce jurisdiction, Federal was in New Orleans, Federal have an alternative forum, a transferee in -- forum in Memphis.

So certainly, have the in rem feature not been joined, there would be no question about the possibility of transfer in this action to --

Justice Potter Stewart: Why couldn't this action have simply been brought in Memphis in personam?

Mr. George B. Matthews: I know of no reason why it couldn't.

Justice Potter Stewart: Of course it wasn't signed so I'm thinking (Voice Overlap) --

Mr. George B. Matthews: Federal is amenable to process in Memphis, at the -- for a week after the casualty, the barge was amenable to process in Memphis.

Justice Charles E. Whittaker: This would be probably true had the action been brought to one personam in Memphis, petitioner wouldn't have your bond, would he?

Mr. George B. Matthews: Mr. Justice Whittaker, they do not have a bond now.

All they have is a letter of undertaking signed by Federal alone and not Federal's underwriters saying, “We will do what we would have to do anyhow.”

That is, pay the decree if you get one.

Justice Charles E. Whittaker: I don't know if I understand it and that bring us, and we're supposed to because that's (Voice Overlap) --

Mr. George B. Matthews: The letter of undertaking, there are two types generally.

There is an owner's letter and an underwriter's letter.

The underwriter's letter is in terms identical to a release bond except no premium is charged, that's the only difference I know of.

An owner's letter, simply says, “In consideration of your not seizing my barge and not requiring a release bond, I agree to pay any judgment you got against me or the barge.”

But that is nothing more than an obligation that I would have in the event of a decree.

Justice Charles E. Whittaker: Either that or the barge thing?

Mr. George B. Matthews: Just -- no, because the giving of the letter releases the lien I think, because the letter provided that the rights of the parties would be the same as if a release bond had been given and there is no question that if a release bond was given, the lien would be released.

So I think a fair construction of the letter, and I'm sure concurred in by our opponents is that the giving of the letter release the lien and the barge was free from -- thereon.

Thank you.

Print this transcript Transcript: 

Argument of George B. Matthews

Mr. George B. Matthews: May it please the Court.

With reference to a question which Mr. Justice Stewart asked regarding the consent waiver in this case, there is no consent in so many words, however, we submit that whereas in this case following the falling of the libel not only was a personal appearance entered, but a claim was filed for the vessel and the letter of undertaking was given that the motion is tantamount to a consent since it will carry with it the appearances.

Secondly, I might further mention that in the General Electric case decided by Mr. Justice Whittaker, he remarked that in his opinion, there was little question with that, a motion constituted a waiver of venue -- a motion to transfer constitute a consent to transfer our waiver.

Justice Potter Stewart: Do you think it could be argued that the substitution of a bond or of an undertaking such as is in this case converts an in rem action to an in personam action?

Mr. George B. Matthews: No, sir.

I don't think that could be argued.

However, I don't know what the difference is or maybe it's a distinction without a difference except in one case that occurs to me.

For example, in the Public Vessels Act, there is no provision for in rem seizure of public vessels.

However, a libelant may elect to proceed according to principles in rem.

As I say, what that amounts to with one exception, frankly, I don't know.

The exception being the case of compulsory pilotage where the courts upheld that an owner is not liable in personam for the negligence of a state required or compulsory pilotage but that a vessel is.

Now, that is the only distinction that occurs to me between an in rem and an in personam action or liability, if you want.

Justice Potter Stewart: Beyond that, you think it's just a matter of labels?

Mr. George B. Matthews: Correct.

Justice Potter Stewart: Falling out of libel instead of a complaint or some --

Mr. George B. Matthews: Beyond the point of jurisdiction and security and except for the compulsory pilotage case, yes.

Now, in this Court --

Justice Felix Frankfurter: (Inaudible)

Mr. George B. Matthews: Sir?

Justice Felix Frankfurter: (Inaudible)

Mr. George B. Matthews: Unless there is an expressed statute such as in the carriage of goods by sea, there is no limitation, Mr. Justice Frankfurter.

There's a doctrine of laches.

Justice Felix Frankfurter: (Inaudible)

Mr. George B. Matthews: No, sir.

There are --

Justice Felix Frankfurter: (Inaudible)

Mr. George B. Matthews: I -- I'm -- I don't envision a case at the moment.

Justice Felix Frankfurter: (Inaudible)

Mr. George B. Matthews: I -- I don't quite see it.

I know of no case.

Justice Charles E. Whittaker: Mr. Matthews, could you tell us of what -- what would this judgment if the plaintiff is successful per se?

Would it just award dollars to be made on execution?

What would the judge -- terms of the judgment be?

Mr. George B. Matthews: The judgment would be against Federal Barge Lines certainly in the in personam action and --

Justice Charles E. Whittaker: No, in this action and defend like that.

Mr. George B. Matthews: The in personam -- there are two actions here, Mr. Justice Whittaker.

Justice Charles E. Whittaker: I'm talking about the one in Louisiana.

Mr. George B. Matthews: There are two actions, two --

Justice Charles E. Whittaker: In Louisiana?

Mr. George B. Matthews: Two -- there are two actions.

Yes, sir.

One action but two, not a cross proceeding.

Justice Charles E. Whittaker: Was that the first claim?

Mr. George B. Matthews: No, sir.

There is an in personam action against Federal Barge Lines seeking a recovery against that individual respondent.

Joined to that is a proceeding, it's all one proceeding actually.

I'm maybe using words loosely.

But, as part of that action, there is a prayer for a recovery in rem against the Barge FBL-585.

Those two recoveries sought are part of one action, so that if there is a finding of fault on the respondent's part and/or on the part of the barge, there would be a decree in favor of Continental and against Federal on account of the -- or rather in response to the in personam prayer.

There would also be a decree against the barge and her stipulators or her surety if you want in response to the in rem part of the action.

However, since the lien on the Barge would have been discharged by the giving of the bond, the decree would be satisfied by the barge's stipulators or surety.

Justice Charles E. Whittaker: But the decree would run against the Barge.

Mr. George B. Matthews: Or her stipulators, yes.

Justice Charles E. Whittaker: Or, or or/and?

Mr. George B. Matthews: Or.

I'd -- I don't -- I -- I would -- I don't know that there'll be any great difference, I would assume.

In any event, it would be satisfied by the stipulators.

Justice Charles E. Whittaker: It makes a difference to my mind and my processes of thinking is to whether or not that barge is going to be held in this decree.

Mr. George B. Matthews: I'll say this to you.

It's somewhat inconsistent to me.

That is the way decrees are drawn, but that to my mind, conflicts with the jurisprudence which is certainly are well established that the giving of a bond releases any lien for account of which the bond is given.

Justice Felix Frankfurter: (Inaudible)

Mr. George B. Matthews: I think that's a loose phrasing of his because --

Justice Felix Frankfurter: (Inaudible)

Mr. George B. Matthews: Sir?

Justice Felix Frankfurter: (Inaudible)

Mr. George B. Matthews: Look, the Court will note the statement in -- in our question presented on page 2 of our brief, we post it as follows, whether a District Court may on motion of the respondent transfer an admiralty suit brought -- brought both in personam and in rem --

Justice Felix Frankfurter: (Inaudible)

Mr. George B. Matthews: -- to another district wherein the in personam respondent was suable from -- but from which the risk had been removed prior to the falling of -- of the libel.

Justice Felix Frankfurter: (Inaudible)

Mr. George B. Matthews: No, sir, with the respondent.

I'm reading from the question -- we contraverted there, the petitioner's question presented is the Brown pretty far on page 2.

Justice Felix Frankfurter: (Inaudible)

Mr. George B. Matthews: The -- the -- yes, sir, as well as the lower court's per curiam.

Justice Felix Frankfurter: (Inaudible)

Mr. George B. Matthews: How do you mean, sir?

Justice Felix Frankfurter: (Inaudible)

Mr. George B. Matthews: Yes.

Justice John M. Harlan: (Inaudible)

Mr. George B. Matthews: You mean that there was -- that there were two --

Justice John M. Harlan: Both in personam.

Mr. George B. Matthews: Oh, yes.

Justice Felix Frankfurter: (Inaudible)

Mr. George B. Matthews: One further the point I like to mention which I think is quite important and that is that in this case, we are not confounded with any statutory venue requirements.

There are none here.

Venue in an in personam action is wherever the respondent can be caught to -- so to put it, or whether wherever his property can be attached by a writ of foreign attachment.

That maybe in anyone of a number of places, for instance, a New York respondent may have property in Louisiana which we could seized, perform the basis of -- of personal jurisdiction at least to the extent of property.

Venue in an in personam action is basically where the vessel is or where the owner or claimant should it be a charge we will agree to appear for the vessel.

Justice Felix Frankfurter: What's the basis for (Inaudible)

Mr. George B. Matthews: Yes, sir, I think it is.

And that's one difference between this case and the two preceding cases, one basic difference I think.

Justice Hugo L. Black: (Inaudible)

Mr. George B. Matthews: The in personam respondent, Mr. Justice Black, was suable in Memphis so that had the in rem action not be enjoined to the in personam action.

There would be -- we would not be here today because there would be an ultimate forum under any theory of this statute.

Justice Hugo L. Black: (Inaudible)

Mr. George B. Matthews: Because it maintained an office there.

Justice Hugo L. Black: (Inaudible)

Mr. George B. Matthews: And the in rem --

Justice Hugo L. Black: (Inaudible)

Mr. George B. Matthews: If that be -- if that would be the correct theory.

Justice Hugo L. Black: (Inaudible)

Mr. George B. Matthews: Correct.

Thank you, Your Honors.

Argument of Eberhard P. Deutsch

Mr. Eberhard P. Deutsch: Just a -- a few more words.

May it please the Court.

Whether a question -- with regard to the question as to the nature of the proceeding and the fact that it is not in personam so far as it's postured before this Court is concerned.

I direct your attention to pages 16 and 17 of the transcript, so that we will understand this so-called letter of undertaking.

It -- it is simply a substitute for a so-called stipulation which an admiralty is a name for a shorty bond.

And at the bottom of the page, you will see it is the intent of this undertaking that the rights of the libel and then claimant respondent in this proceeding shall be in full, purposes shall be taken to be precisely the same as they would have been had the vessel in fact been taken into custody by the marshall under said in rem process and released for the filing of claim and release bond.

We, as claimant reserving in behalf of the vessel all other objections and defenses otherwise available, except those which might be predicated upon the fact that the vessel was not actually seen.

In other words, the cases in rem proceeding, its character has not been changed by the giving of this letter of undertaking which says, “We'll pay any judgment you get against the Barge.”

And the judgment or decree in admiralty is for dollars against the vessel requires her condemnation and sale to satisfy the judgment and that condemnation and sale of course does not take place if someone comes in and voluntarily pays the amount due which is the normal course especially when bonds are posted.

Justice Hugo L. Black: (Inaudible)

Mr. Eberhard P. Deutsch: Well, I think you -- I think you can put the statement that way but it is only the in rem part of the proceeding which has come here as Judge Brown said.

That was the only question decided below with regard to this phase of the case.

It's all one proceeding.

Justice Felix Frankfurter: (Inaudible)

Mr. Eberhard P. Deutsch: Well --

Justice Felix Frankfurter: (Inaudible)

Mr. Eberhard P. Deutsch: It's all one, yes.

Justice Felix Frankfurter: (Inaudible)

Mr. Eberhard P. Deutsch: You can't very well split it and say we have two actions and we'll transfer the in personam and keep the in rem so that as a matter of course, it -- you couldn't transfer the in personam without the in rem because its just one -- one libel.

Justice Hugo L. Black: (Inaudible)

Mr. Eberhard P. Deutsch: Oh, no, they are all in one proceeding which is the normal practice.

The cases have so held that it is permissible to do it.

But they are -- you could file a libel in personam in one district and the libel in rem in another and the two cases would go on neither subject to dismissal.

Justice Hugo L. Black: (Inaudible)

Mr. Eberhard P. Deutsch: Well, of course, that's a very difficult question.

I suppose that the Court of Appeals and certainly all of us, and there's never -- we've never really raised the -- that question.

I have assumed that the in rem action takes the precedence because it is the one that could not be moved to one side.

It must remain where it was brought.

Justice Hugo L. Black: (Inaudible)

Mr. Eberhard P. Deutsch: There isn't the slightest question that if this were an in personam action alone, there was a second available forum.

There isn't any question about that.

Justice Felix Frankfurter: (Inaudible)

Mr. Eberhard P. Deutsch: New Orleans, sir.

Justice Felix Frankfurter: (Inaudible)

Mr. Eberhard P. Deutsch: Well, I don't think you can split the action that's two parts.

No, sir.

Justice Felix Frankfurter: (Inaudible)

Mr. Eberhard P. Deutsch: As you would -- but we didn't have them here.

We haven't.

We -- they are not separate here.

They are all one.

Justice Felix Frankfurter: (Inaudible)

Mr. Eberhard P. Deutsch: I said that if this Court were to hold that, that would be the result but I don't think it's a correct -- I think the in rem action has its situs and must remain there and that brings up, Mr. Justice Whittaker's --

Justice Hugo L. Black: (Inaudible)

Mr. Eberhard P. Deutsch: Surely.

Justice Hugo L. Black: (Inaudible)

Mr. Eberhard P. Deutsch: There's no question about --

Justice Hugo L. Black: (Inaudible)

Mr. Eberhard P. Deutsch: No question about that.

It is our position that this action may not be transferred onto that stat --

Justice Hugo L. Black: (Inaudible)

Mr. Eberhard P. Deutsch: Yes, sir.

But I -- I don't think the rules are different in admiralty case, sua sponte, you have to, an admiralty case in rem.

I had -- in this case to be joined in a single action with a one in personam, but setting that aside for a moment, the 1404 (a) as it relates to admiralty actions in personam in my humble opinion be treated just like any other civil action.

Justice Hugo L. Black: (Inaudible)

Mr. Eberhard P. Deutsch: It's a point I was just coming to, Mr. Justice Whittaker as to battle a local action.

In my humble opinion, 1404 (a) can have no effect whatever on a local action.

You can't bring an action to foreclose land anywhere except where the land is.

Justice Potter Stewart: Well, that's because only one District Court has jurisdiction --

Mr. Eberhard P. Deutsch: Right.

Justice Potter Stewart: -- over the subject matter.

Mr. Eberhard P. Deutsch: Right.

Justice Potter Stewart: Quite a part from --

Mr. Eberhard P. Deutsch: That is correct --

Justice Potter Stewart: -- venue or jurist -- or a personam.

Mr. Eberhard P. Deutsch: Now, in this case, you have a race which is movable.

Justice Potter Stewart: Yes.

Mr. Eberhard P. Deutsch: And you can bring the action wherever that race happens to be at the time.

In the land, it can only happen to be in one place, but the principle is the same in my opinion.

Justice Felix Frankfurter: (Inaudible)

Mr. Eberhard P. Deutsch: That's right.

Justice Potter Stewart: Question put in your petition for certiorari is confided in rem.

Mr. Eberhard P. Deutsch: That's right.

Chief Justice Earl Warren: (Inaudible)

Mr. Eberhard P. Deutsch: I don't think --

Chief Justice Earl Warren: (Inaudible)

Mr. Eberhard P. Deutsch: I think we must, yes.

I think that is correct, the latter statement, yes.

Now, very briefly, if I may be allowed a couple of moments more.

This question about an in rem action and it's applying only in compulsory pilotage cases and so on, it's a very real thing.

A solvent owner is liable in an in rem action only insofar as the value of that vessel is concerned and no more and that is very important matter.

In a salvage case for instance, the owner isn't liable at all unless he has made an agreement.

The vessel alone is liable.

He may defend and try to get the salvage reduced if he has that much of an interest.

In the case of the bareboat charter, when the vessel is in collision, the owner is never liable.

He said no part in the land and so on.

There are a number of such cases.

It isn't just one thing.

Finally, with regard to a question which was asked yesterday by Mr. Justice Harlan that occurred to me about Judge Learned Hand having expressed himself on this subject, the case is Foster-milburn v. Knight in 181 F.2d, he did express himself as saying that the role that there can -- that there must be two forums applies under 1404 (a).

Unknown Speaker: (Inaudible)

Mr. Eberhard P. Deutsch: He has quoted it from Justice Jackson's opinion.

Justice Felix Frankfurter: (Inaudible)

Mr. Eberhard P. Deutsch: I don't think it is but in the Torres --

Justice Felix Frankfurter: (Inaudible)

Mr. Eberhard P. Deutsch: In the Torres case which is cited -- the Anthony versus Kaufman case, Judge Frank does say that.

The Torres case however, talks of the vessel having been available in the transferee district as well.

And then Judge Medina goes on and says, “Anyway, they've waived it here.”

Now, to that extent, it is a doctrine.

Thank you.