Opinion · District Court, S.D. New York

The Beechwood

Beechwood, 35 F.2d 41 (District Court, S.D. New York 1929)

Type
Opinion
Court
District Court, S.D. New York
Jurisdiction
New York
Date
1929-09-16
Topic
international-arbitration

CAFFEY, District Judge. Counsel agreed at the argument that the decision of the principal question turns upon the interpretation of the United States Arbitration Act of February 12,1925, 43 Stat. 883, chapter 213 (USCA title 9). A stipulation, in a marine instrument of the type of the documents under consideration, for arbitration in London comes within the words of section 2 of the statute.(9 USCA § 2). To construe those words, however, so as to include such a stipulation plainly would make section 2 inconsistent with or would nullify or would render inoperative sundry provisions of sections 4, 7, 9, 10, 11, and 12 (9 USCA §§ 4, 7, 9-12); possibly also certain parts of sections 5, 8, and 13 (9 USCA §§ 5, 8, 13). Under well- *43 settled rules it is imperative therefore that the general words of section 2 be limited in application so as not to embrace arbitrations abroad (e. g., Peck v.

Citator

UpLaw has not yet analyzed The Beechwood. The absence of a flag is not a finding that it is good law.

Cited by
2 opinions
THE BEECHWOOD, (S.D.N.Y. 1929)
35 F.2d 41
THE BEECHWOOD (two cases). THE INVERARDER (two cases).
United States District Court, S.D. New York.
September 16, 1929.
In Admiralty. Separate libels by the American Creosote Works, Incorporated, andPage 42by the American Creosoting Company against the steamship Beechwood, the Molasses General Export Company, Limited, claimant, and by the Bernuth Lembcke Company, Incorporated, and by the Ayer Lord Tie Company against the steamship Inverarder, the British Mexican Petroleum Company, claimant. On libelants' exceptions to certain defenses in the Beachwood cases and on respondent's motion for dismissal in the Inverarder cases. Exceptions to interrogatories overruled.

These actions were instituted by the several libelants to recover for shortage out of shipments of creosote oil originating at European ports and consigned to purchasers in the United States.

In the Beechwood cases, the carrier interposed the following defense:

"Further answering and as a further and separate defense it is alleged that the merchandise mentioned in the libel was carried under a contract of affreightment and special contract dated October 20, 1927, which is annexed hereto as Exhibit A and made a part thereof. The said contract of carriage contained among others the following provision:

"`25. Any dispute arising out of or in connection with this Charter to be settled by arbitration in London by two arbitrators (one to be named by each party) and an umpire, in manner provided by the Arbitration Act, 1889, or any statutory modification thereof, and otherwise by the law of England. For the purpose of enforcing awards this Agreement may be made a rule of Court. Both arbitrators and umpire shall be commercial men.'

"Inasmuch as the parties hereto have expressly agreed to arbitration of this dispute arising out of the contract, the Court should dismiss the libel and remit the libelant to its rights to arbitration as provided for in the contract."

In the Bernuth, Lembcke Company case, the following was pleaded in defense:

"Further answering and as a further and separate defense to the first and second causes of action it alleges on information and belief that the creosote or creosote oil referred to in the libel was shipped under and pursuant to the terms of a charter, a copy of which is hereto annexed as Exhibit A. That charter contained among others the following provision:

"`18. Any dispute arising during execution of this Charter Party shall be settled in London, Owners and Charterers each appointing an Arbitrator, and the two thus chosen, if they cannot agree, shall nominate a third, whose decision shall be final. Should one of the parties neglect or refuse to appoint an Arbitrator within twenty-one days after receipt of request from the other party, the single Arbitrator appointed shall have the right to decide alone, and his decision shall be binding on both parties. For the purpose of enforcing awards this agreement shall be made a Rule of Court.'

"By reason of this provision the libelant herein is barred from proceeding with this libel and the libel should be dismissed. Claimant and respondent claim the right to proceed with arbitration pursuant to the aforesaid provision."

A defense similar to that in the Beechwood cases was pleaded in the Ayer Lord Tie Company case.

In all of the cases involved, the libelants filed exceptions to the above defenses. On September 10, 1929, libelants in the Beechwood cases brought on for argument their exceptions to the foregoing defenses, and, upon the same day, the claimant and respondent in the Inverarder cases moved for a dismissal of the libels on the ground that the court had no jurisdiction, or, in the alternative, for a stay of proceedings pending an arbitration in London. By consent of counsel, all the cases were argued at the same time.
Single Single, of New York City (Robert E. Hill and Gregory S. Rivkins, both of New York City, of counsel), for libelants.

Kirlin, Campbell, Hickox, Keating McGrann, of New York City (L. de Grove Potter, of New York City, of counsel), for claimants and respondents.
CAFFEY, District Judge.
Counsel agreed at the argument that the decision of the principal question turns upon the interpretation of the United States Arbitration Act of February 12, 1925,43 Stat. 883, chapter 213 (USCA title 9).

A stipulation, in a marine instrument of the type of the documents under consideration, for arbitration in London comes within the words of section 2 of the statute (9 USCA § 2). To construe those words, however, so as to include such a stipulation plainly would make section 2 inconsistent with or would nullify or would render inoperative sundry provisions of sections 4, 7, 9, 10, 11, and 12 (9 USCA §§ 4,7, 9-12); possibly also certain parts of sections 5, 8, and 13 (9 USCA §§ 5,8,13). Under well-settledPage 43rules it is imperative therefore that the general words of section 2 be limited in application so as not to embrace arbitrations abroad (e.g., Peck v. Jenness, 7 How. 612, 623,12 L. Ed. 841; Heydenfeldt v. Daney Gold Silver Mining Co.,93 U.S. 634,638,23 L. Ed. 995; McKee v. U.S.,164 U.S. 287,293,17 S. Ct. 92,41 L. Ed. 437; U.S. v. Trans-Missouri Freight Association,166 U.S. 290,320,17 S. Ct. 540,41 L. Ed. 1007).

The same conclusion was reached in The Silverbrook (D.C.)18 F.2d 144, and The Fredensbro (D.C.)18 F.2d 983.

As the statute does not validate the arbitration clauses involved here, the cases are governed by the law as established by the Supreme Court and summarized in United States Asphalt R. Co. v. Trinidad Lake P. Co. (D.C.) 222 F. 1006.

My impression is that what has been said disposes of all the issues (other than with respect to the interrogatories) now before me. If any counsel thinks I am in error in that regard, my attention should be called to it.

Exceptions to all interrogatories will be overruled. All interrogatories should be answered.

Leave to amend answers was not opposed and is granted.

Settle orders accordingly.Page 43