Providence & New York Steamship Co. v. Hill Manufacturing Co.

delivered the opinion of the court.

The writ of error in this case brings up for consideration a judgment of the Supreme Judicial Court of Massachusetts rendered in an action brought' by The Hill' Manufacturing Company against the Providence and New York Steamship Company as common carriers, to recover .damages for the loss of certain goods delivered by the plaintiffs to the defendants at Providence, Ehode Island, to be transported to the city of New York, which goods, it is alleged, were, by the negligence of the defendants, burned and injured by fire. The loss is stated to have occurred in May, 1868; the action, was. commenced in September, 1870. The defendants first put in an answer denying the allegations of the declarations'; but averring that if the goods were delivered to them for the purpose stated, they were delivered to and received by them to be transported to the city of New York over Long Island Sound (not being river or inland navigation), and were safely transported to New York in their steamship Oceanus, and that the damage, if any, was caused'by fire happenirig to said steamship at her dock in New

“ That no owner or owners of any ship or vessel shall be subject or liable to answer for or make good to any one or more person or persons any loss or damage which may happen to any goods or merchandise whatsoever, which shall be shipped, taken in, or put on board any such ship or vessel -by reason or by means of any fire happening to or on board the said ship or vessel, unless such fire is caused by the design or neglect of such owner or owners.”

And the 'third section of said act provided as follows, to wit:

“ That the liability of the owner or owners of any ship or vessel for any embezzlement, loss, or destruction by the master, officers, mariners, passengers, or any other person or persons, of any property, goods, or merchandise shijiped or put on board such ship or vessel, or for any loss, damage, or injury by collision, or for any act, matter or thing, loss,.damage, or forfeiture done, occasioned, or incurred without the privity or knowledge of such owner or owners,- shall in no case exceed the amount or value of the interest of such owner or owners respectively in such ship or vessel and ■her freight then pending.”

The defendants subsequently amended their answer by adding a particular statement of the manner in which the loss occurred, namely, by a fire at New York, which commenced in a building on the wharf or pier at which the steamship lay after her arrival, and was rapidly communicated to the vessel, which was burned to the water’s edge, together -with most of her cargo, including not only the goods of the plaintiffs, but a large quantity of goods of other persons, greatly exceeding in amount , the value of the defendants’-interest in the vessel and her freight then pending. The amended answer further stated, that the defendants having been sued in the

The answer further stated that' the defendants, pursuant to the order of said district court, entered into a stipulation, with two sureties, to pay the value of said ihterest and freight as so appraised into said district court whenever ordered, which stipulation was approved, and said order having beén complied with, a monition was thereupon issued by said district court against all persons claiming damages for the loss, destruction, damage, and injury occasioned by said fire on board said steamer, citing them to appear before said district court and make due proof of their respective claims at or before a certain time named in said monition, to wit, at or before the fifteenth day of October, a.d. 1872, which time was at least three months from the issuing of said monition'; and designating George E. Betts, Esq., a commissioner of said district court, as the commissioner before whom such claims should be presented, in- pursuance of said monition, and ordering public and other notice of said monition as therein set forth, and that said notice had been served on the said Hill Manufacturing Company, as well as on all other claimants, pursuant to said monition; and said district court duly made- an order restraining the further prosecution of all and any suit or suits against the; defendants in respect of any such claim or claims.

The answer then referred to á certified copy of the libel and '.the proceedings thereon, annexed to and .made part of the answer, and also made profert of said libel and proceedings,' and concluded as follows: -

“ And these defendants -further say that said fire, and the injury

thereby caused or occasioned, -was without the privity or knowledge of these defendants. And these defendants further answering, say that if the plaintiffs have any claim by reason of any injury to said cotton cloth, it cannot be enforced in this action, but can only be- enforced in said suit in said district court, and then and there only under and pursuant to said act of Congress. And these defendants, further answering, say that said steamer Oceanus was not a canal boat, barge, or lighter, and was not used in rivers or inland navigation, and that said voyage from Providence to said city of New York was not in rivers or inland navigation; and that an injunction has been issued by said district court against said Hill Manufacturing Company, restraining and enjoining them from the further prosecution of this suit, and that said injunction has been duly served on said Hill Manufacturing Company ; and further, that said Hill Manufacturing Company sued in this court the Boston & Lowell Railroad Company for the- alleged loss and injury complained of in the declaration in this cause to the cotton cloth therein mentioned, and recovered therein a judgment against said Boston & Lowell Railroad Company for said alleged loss and injury, which judgment was settled, paid, and satisfied.”

Upon the filing of this answer the casé was opened to a jury,' but before any verdict was taken the cage was reserved, upon the report of the judge who presided at the trial, for the consideration of the full court. In September term, 18Y5, it was ordered by the Supreme Judicial Court that the case do stand for trial. Whereupon the defendants filed the following objec- ■ •tions, viz.: ■

“ And now, with the view of having this action taken to the. Supreme Court of the United States upon a writ of error, if the final judgment therein in this honorable court shall be against the defendants, and for the purpose of saving the rights of the defendants, and so that their going to trial shall not be .construed a waiver of their rights or of the objections herein, said defendants come and object to and protest against the ruling and decision of this honorable court ordering %nd directing said action to stand for trial, and also the ruling of this honorable court that if the loss com dained of by the plaintiffs was occasioned by the .neglect

of defendants it must have been with their privity or knowledge and was not within the act of Congress limiting the liability of ship owners ; also the ruling that the proceedings in the district court of the United States did not affect the jurisdiction'of this honorable court.”

' In April term, 1876, the cause came on for trial, and the defendants, by leave of the court, further amended their answer by setting forth, amongst other things, the final decree of the District Court of the United States for the Southern District of New York, made on the 16th of October, 1872, by which it was adjudged and decreed that the Hill Manufacturing Company (the plaintiffs in the present suit), among other parties, be forever debarred from prosecuting any claims for damages for any loss, damage, or injury occasioned by the fire on board the steamer Oceanus, on the 24th of May, 1868.

Thereupon the trial proceeded, and the evidence showed that the plaintiffs’ goods were 'delivered to the defendants at Providence to be transported to New York, and were thus transported in the steamer Oceanus, upon Long Island Sound, and that the vessel safely arrived at New York with the goods on board, and was moored in a slip or dock on the North River side .on a Sunday morniiig; and whilst lying there on that day, ready to be discharged, the fire occurred which caused the loss in question, commencing in a building on the wharf or pier which was used by the defendants in their transportation business. The plaintiffs adduced evidence tending to show that this building was not properly constructed and managed to avoid the risk of fire, and that the defendants were guilty of negligence in that behalf; and they contended that if the jury believed that the defendants were guilty of such negligence, they could not claim the benefit Of the act of Congress, but were liable to respond for the loss of the goods. The defendants adduced counter proofs, tending to show that they were not guilty of any negligence; and also put in evidence the record of proceedings upon their libel and petition in the, District Court of the United Stated for the Southern District of New York, corresponding to the statements of their

After the evidence was closed, the defendants asked the court to rule that upon the whole evidence in the case the plaintiffs could not maintain their action, and that the jury must find for the defendants; but the court refused so to rule. The defendants then asked the court- to instruct the jury, amongst other things, as follows :

“ 1. That under the proper construction of the act of Congress entitled c An Act to limit the liability of ship owners, and for other purposes ’ (U. S. Stat. 1851, ch. 43), the libel and petition of the defendants filed in the District Court of the United States for the Southern District of New York, and the proceedings had thereon, the record of which has been put in evidence, are a bar to the plaintiffs’ action.

“ 2. That under the proper construction of said act of Congress, the plaintiffs are precluded from maintaining their action by said proceedings in said district court.

■ “ 3. That by the decree of said district court, made upon said libel and petition, and the subsequent proceedings thereon, it has

been adjudged, as between the parties to the present suit, that the fire which caused the damage, for which the plaintiffs seek to recover; was not caused by the design or neglect of the defendants,' within the meaning of sáid act of Congress.”

The court refused to give these instructions ; but left it to the jury to find for the plaintiffs if they were satisfied from the evidence that the fire was caused by the negligence of the defendants, either in respect to the construction and equipment of the vessel, or in respect to the construction and management of-the pier or buildings thereon.

To all the rulings of the court the defendants excepted; and the jury having found a verdict for the plaintiffs, the exceptions were argued before the supreme judicial court, and were overruled, and judgment was entered for the plaintiffs. To that judgment this writ of error is brought. The case, as decided by the Supreme Judicial Court of Massachusetts, is reported in 113 Mass.- 495 , and 125 Mass. 292 .

The principal question in this case is, whether the institution of proceedings in the District Court of the United States, under the act of 1851, for procuring a decree of limited liability of the owners of the Oceanus (the defendants in the present action), for the losses and injuries to goods on board of the vessel, superseded the prosecution of claims for the same losses and injuries in other courts. It seems to us that this must be the necessary effect of such proceedings, and that this results as well from the language of the law, as from its object and purpose.

The first section of the act exempts ship owners from liability for losses on board of their ship by fire, “ unless such fire' is caused by the design or neglect of such owner or owners.”

The second section relates to the shipping of' precious metals and other valuables without giving notice of their character and value, and exempts the master and owners of the vessel, in such case, from liability as carriers. -

The third section declares that the liability of ship owners' for embezzlement,-loss or destruction of goods on board of their ship by the master, crew, passengers or others, or for loss or.

■ The fourth section of the law declares, “ That if any such embezzlement, loss or destruction shall be suffered by several freighters or owners of goods, wares or merchandise, or any property whatever on the same voyage, and the whole value of the ship or vessel and her freight for the voyage shall not be sufficient to make compensation to each of them, they shall receive compensation from the owner or owners of the ship or vessel in proportion to their respective losses; and for that purpose the said freighters and owners of the property, and the owner or owners of the ship or vessel, or any of them, may take the appropriate proceedings in any court for the purpose of apportioning the sum for which the owner or owners of the ship or vessel may be hable amongst the parties entitled thereto. And it, shall be deemed a sufficient compliance with the requirements of this act on the part of such owner or owners, if he or they shah transfer his or their interest in such-vessel and freight for the benefit of such claimants, to a trustee, to be appointed by any court of competent jurisdiction, to act as such trustee for the person or persons who may prove to be legally entitled thereto, from and after which transfer ah claims and proceedings against the owner or owners shah cease.” 9 Stat. 635 , 636.

By the last section of the act it is declared that it shah not apply to the -owner or owners of any canal- boat, barge,, or lighter, or to any vessel of any description Avhatever, used in rivers of inland navigation.

In these provisions of the statute we have sketched in outline a scheme of laws and regulations for the benefit of the shipping ' interest, the value and importance of Avhich to our maritime .commerce can hardly be estimated. Nevertheless, the practical valué of the law will largely depend on the manner in which it-is administered." If the courts having the execution

As the present case raises a question of great importance to the practical and successful working of the law, the decision of which, indeed, will determine whether.it is to be of any real value, it will be proper to- examine a little the grounds on which, as well the law itself as the proceedings adopted for carrying it into execution, rest for their support.

We have no doubt that Congress had power to pass the law. It is not only a maritime regulation in its character, but it. is clear1 y within the scope of the power given to Congress “ to regulate commerce.” In the case of the lottcmana, 21 "Wall. 558, speaking of the power to make changes in the maritime law of the country, we said:

“ Congress undoubtedly has authority under, the commercial power, if no other, to introduce such changes as are likely to be needed. The scope of the maritime law and that of commercial regulation are not coterminous, it'is true ; but the latter'embraces much the largest portion of ground covered by the former. Under it Congress has regulated the registry, enrollment, license, and nationality of ships and vessels ; the method of recording bills of sale and mortgages thereon ; the rights and duties of seamen ; the limitations of the responsibility of ship owners for the negligence and misconduct' of their captains and crews ; and many other things of a character truly maritime. . . . On this subject the remarks of Mr. Justice Nelson, in delivering the opinion of the court in White's Bank v. Smith, 7 Wall. 655 (which established the validity and effect of the act respecting the record

ing of mortgages on vessels in the custom house) are pertinent. He says, ‘ Ships or vessels of the United States are creatures of the legislation of Congress. None can be denominated such, or be entitled to the benefits or privileges thereof, except those registered or enrolled according to the act of September 1st, 1789 ; and those which, after the last day of March, 1793, shall be registered or enrolled in pursuance of the act of 31st December, 1792, and must be wholly owned by a citizen or citizens of' the United States, and to be commanded by a citizen of the same. .Congress having created, as it were, this species of property and .conferred upon it its chief value, under the power given in the Constitution to-regulate commerce, we perceive no reason for entertaining any serious doubt but that this power may be extended to the. securing and protection of the rights and title of all persons dealing therein.’ ”

It need not, be added that if Congress had power to ‘pass the act of 1851, it is binding on all courts and jurisdictions throughout the United States. •

We have said that, by the provisions of the acty the scheme was sketched in outline. A reference to its provisions shows that it was only in outline; and that the regulation of - details as to the form and modes of proceeding was left to be prescribed by judicial authority. The law was evidently. drawn in view cif similar laws adopted and in operation in England and in some of the States. • It laid down a few general principles and propositions, and left it to the courts to enforce them and carry them into practical effect.

Although the act was passed in 1851, it stood on the statute book for twenty years before a careful scrutiny of its provisions was demanded of this court. In the case- of The Norwich Transportation Company v. Wright, decided in December term, 1811, and "reported in 13"Wallace, 101, we were called upon to interpret the act, and to adopt some general rules for the better carrying of it into effect. On that occasion, a history of similar acts, both in. England and this country, an examination of the general maritime law on the same subject, and the circumstances under which the act of 1851 was passed, were reviewed, and the general effect and. construction of -the

“ The proper course of proceeding for obtaining the benefit of the act would seem to be this : When a libel for damages is filed, either against the ship in rein or the owners in personam, the latter (whether with or without an answer to the merits) should file a proper petition for an apportionment of the damages' according to the statute, and should pay into court (if the vessel or its proceeds is not already there), or give due stipulation for, such sum as the court may, by proper inquiry, find to be the amount of the limited liability, or else surrender the ship and freight by assigning them to a trustee in the manner pointed out in the fourth section. Having done .this, the ship owner will beerititled to a monition against all persons to appear and intervene pro interesse suo, and to an order restraining the prosecution of other suits. If an action should be brought in a State court, the ship owners should file a libel in admiralty, witb a like surrender or deposit of the fund, and either plead the fact in bar in the State court, or procure an order from the district court to restrain the further prosecution of the suit. The court having jurisdiction of the case, under and by virtue of the act of Congress, would, have the right to enforce its jurisdiction and to ascertain and determine the rights of the parties. For aiding parties in this behalf, and facilitating proceedings in the ‘district courts, we. have prepared some rules which will be announced at an early day.”

These rules were announced at a subsequent day of the same term, and will be found at the commencement of 13 Wallace, pages xii. xiii.

The substance of these rules, so far as relates to the purpose in hand, was as follows: that ship owners desiring to claim the benefit of limitation of liability provided for in' the third and fourth sections of the act, may file a libel or petition in

Provision is then made for proof of all claims before a commissioner to be appointed by the court, for a report thereon, and' for a pro rata distribution of the money paid into court, or the proceeds of the ship and freight, amongst the several claimants.

The rules further provide that the ship owners, making suitable allegations for the purpose, shall be at liberty to contest their liability, or the liability of the vessel, to pay any damages, as well as to show that if liable they are entitled to a limitation of liability under the act; and that any parties claiming damages may contest the right of the ship owners to exemption frpm liability, or to the benefit of a limited liability.

Finally, the rules provide that the libel or petition shall be

The court had no doubt then, and has no doubt now, of its power to make these rules under the acts of Congress which authorized it to prescribe the fprmg of proceeding in equity and admiralty causes.- The Process Acts of 1792 and 1828 had declared that the forms of writs and other process, and the forms and modes of proceeding in suits in equity and in those of admiralty and maritime jurisdiction, should be according to the principles, rules and usages which belong to courts of equity and admiralty respectively, as contradistinguished from courts of common law, except as modified by.the Judiciary Act of 1789; but subject to such alterations and additions as the respective courts should In their discretion deem expedient, or to such regulations as the Supreme Court of the United States should think proper from time to time by rule to prescribe to any circuit or district court concerning the same. 1 Stat. 276 ; 4 Stat. 278 . And the Process Act of 1812 gave the supreme court full power and authority to prescribe and regulate the forms of process in the district and circuit courts, and the forms and modes of framing and filing libels, bills, answers and other proceedings and pleadings, in suits at law, in admiralty or in equity in said courts, and the forms and modes of taking evidence, and generally the forms and modes of proceeding to obtain relief, and of drawing up and enrolling decrees, and of proceeding before trustees appointed by the court, and generally to régulate the whole practice of said courts. 5 Stat. 518 .

■ We are clearly of opinion that the authority thus vested in this court was adequate and sufficient to enable it to-make the rules before referred to. The subject is one pre-eminently, of admiralty jurisdiction. The rule of limited liability prescribed by the act of 1851 is nothing more than the old maritime rule administered in courts of -admiralty in all countries except Engy land, .from time immemorial; and if tbia were not so, the suby

"We have deemed it proper to examine thus fully the foundation on which the rules adopted in December term, 1871, were based, because, if those rules are valid and binding (as we deem them to be), it is hardly possible to read them in connection with the act of 1851 without perceiving that after proceedings have been commenced in the proper district court in pursuance thereof, the prosecution pari passu of distinct suits in different courts, or even in the same court by separate claimants, against the ship owners, is, and must.necessarily be, utterly repugnant to such proceedings, and subversive of their object and purpose.

In promulgating the rules referred to, this court expressed its deliberate judgment as to the proper mode of proceeding on the part, of shipowners for the purpose' of having their rights under the act declared and settled by the definitive decree of a competent court, which should be binding on all parties interested, and protect the ship owners from being harassed by litigation in other .tribunals. .Unless some proceeding of this kind were adopted which should bring all the parties interested into one litigation, and all the claimants into concourse for a pro rata distribution of the common fund, it is manifest that in most cases the benefits' of the act could never be realized. Cases might occur, it is true, in which the shipowners could avail themselves of those benefits, by way of defence alone, as where both ship and freight are totally lost, so that the owners are relieved from all liability whatever. But even in that case, iii the absence of a remedy by which they could obtain a decree of exemption as to all claimants, they

This case is very different from that of two concurrent actions for a debt or other demand proceeding at the same time in different courts; though even that, in the English law, was matter for plea in abatement in the action last instituted. Still, as both actions in such case are prosecuted for the same end — the satisfaction of the debt — and as only one satisfaction can be had, no essential conflict arises between the two. But the very object of proceedings for limited liability is to .inquire and determine whether the parties ought to be sued at all in any other tribunal after giving up, or submitting to pay the value of, all their- interest in the ship and freight. Besides, it is obvious on the face of the thing, that proceedings- for limited liability cannot be participated in by two jurisdictions, without interference and conflict between them, and cannot have any useful effect-if a different court may inquire into and decide the same question, and execute a separate judgment independent of, and

The inconveniences that may arise from preventing or arresting the prosecution of separate suits by the claimants are no greater in this case than in the case where proceedings at law are arrested for the purpose of having an investigation in a court of equity, or where distinct and separate suits are restrained for the purpose of settling a common controversy in a single proceeding, as in the case of bills for preventing a multiplicity of suits, and in cases of bankruptcy. By the Bankrupt Act of 1867 it was enacted that no creditor whose debt was provable under the act should be allowed to prosecute to final judgment any suit at law or in equity therefor against the bankrupt, until the question of the debtor’s discharge should have been determined; although, if the amount due the creditor was in dispute, the suit, by leave of the court in bankruptcy, might proceed to júdgment for the purpose of ascertaining the amount, but execution should be stayed. See Hill v. Harding, 107 U. S. 631 . None of the cases here referred to more imperatively require a cessation of proceedings, in other suits for the same cause than that of the proceeding for a limitation of liability under the statute in question;

Nor is the inconvenience any greater than'that which occurs when a case is removed from the State to a federal court. In that case, on the presentation of a petition for removal, duly verified and showing the proper grounds for removal, and accompanied with the bond required by the statute on that subject, the law- declares “ it shall then be the duty of the State court to accept said petition and bond, and proceed no further in such suit.” In the case before us, as well as in the cases of bankruptcy and of removal, the parties have a right to have their causes heard and determined by a court of the United States invested with appropriate jurisdiction,' and capable of affording a proper mode of relief.

In England, where tlie forms and modes of proceeding in the courts of admiralty are (or formerly'were) greatly hampered and

In view of these considerations, and having no doubt of the jurisdiction of the district courts over the matter, as courts of admiralty, in the rules adopted in.December term, 1811, the District Court of the district in which the vessel is libelled or found, or in which the owners are sued, was designated as the proper court in which to institute the proceedings for obtaining a decree of limited liability.,' When cases arise in which the vessel and freight have been totally lost, and no District Court has, or can have, possession of any fund to distribute, resort may probably be had with propriety to the District Court of the district in which the owners reside, or where the vessel perished. It will be time enough, however, to consider what is proper in such exceptional cases when they arise. In Ex parte Slayton, 105 U. S. 451 , we held that jurisdiction accrued to the District Court of the district comprising the port to which the vessel was bound, although she had been sunk in the lake and only a few fragments were washed ashore,, the proceeds of which, however, amounting to a trifling sum, were deposited in court. On this branch of the subject the following reinarks were made in the opinion pronounced in the case of Norwich Transportation Company v. Wright, already cited:

“ The act does not state what court shall be resorted to, nor what 'proceedings shall be taken ; but that the parties, or any of them, may take ‘ the appropriate proceedings in any court, for the purpose of apportioning the sum for which,’ &c. Now, no court is better adapted than a court of admiralty to administer precisely such relief. It happens every day that the proceeds of a vessel, or Other fund, are brought into that court to be distributed amongst those whom it may concern. Claimants are called in by monition to present and substantiate their- respective claims ; and the fund is divided and distributed' according to the respective liens and rights of all the parties. Congress might have invested the Circuit Courts of the United States with jurisdiction of such cases by bill in equity, but it did not. It is also evident that the State courts have not the requisite jurisdiction. Unless, therefore,

the District Courts themselves can administer the law, we are reduced to the dilemma of, inferring that the legislature has framed a law which is incapable of execution. This is never to be done if it can be avoided. We have no doubt that the District Courts, as courts of admiralty and maritime jurisdiction, have jurisdiction of the matter; and this court undoubtedly has the power to make all needful rules and regulations for facilitating the course of proceeding.” 13 Wall, at 123.

We see no reason to modify these views, and, in our judgment, the proper District Court, designated, by the rules, or otherwise indicated by circumstances, has full jurisdiction and plenary power, as a court of admiralty, to entertain and carry on all proper proceedings for the due execution of the law, in all jts parts; and its decrees, in cases subject to its jurisdiction, are valid and binding in all courts and places. In the present case, the proper court undoubtedly was the District Court of the United States for the Southern District of New York, where the remains of the vessel were situated, and where suits were brought against the owners. Proceedings under the act having been duly instituted in this court, it acquired full jurisdiction of the subject-matter; and having taken such jurisdiction, and procured control of the vessel and freight (or their value), constituting the fund to be distributed, and issued its monition to all parties to appear and present their claims, it became the duty of all courts before which any of such claims were prosecuted, upon being properly certified of the proceedings, to suspend further action upon said claims.

But the power of the District Courts to issue an injunction to stay proceedings in a State court is questioned, since, by the Judiciary Act of 1193, 1 Stat. 335 , it was declared that no writ of injunction shall be granted [by the United States courts] “ to stay proceedings in any court of a State.” But the act of 1851 was a subsequent statute, and by the 1th section of this -act — after providing for proceedings to be had under it for the benefit of ship owners, and after declaring that it shall be deemed a sufficient compliance with its requirements on their part if they shall transfer their interest in ship and freight for

This view of the statutory injunction, and of its effect upon separate actions and proceedings, renders it unnecessary to . determine the question as to the legality of the writ of injunction issued by the District Court. Although we have little doubt of its legality, the question can only be properly raised on an application for an attachment for disobeying it. As the writ was issued prior to the adoption of the Revised Statutes, the power to issue. it was not affected by any supposed change of the law introduced into the revision, by the 720th section of which the prohibition of the act of 1793 in regard to injunctions against proceedings in State courts has this exception appended to it: “ except in cases where such injunction may be authorized by any law relating to proceedings in bankruptcy.” Under the rule of “exjoressio unwxs” this express exception may be urged as having the effect of excluding any qther exception; though

But, as before indicated, the legality of the Avrit of injunction is not involved in this case. In our opinion the State court, in overruling the plea of the defendants, Avhich set up the proceedings pending in the District Court, and in ordering the cause to stand for trial; and again, on tlie trial, in overruling as a defence the proceedings and decree of the District Court as set up in the amended ansAver, disregarded the due effect, as well as the express provisions,-of the act of 1851, and therein committed error. It was the duty of the court, as well Avhen the proceedings pending in the District Court were pleaded and verified -by profert of the record, as when the decree of said court Avas pleaded and proved, to have obeyed the injunction of the act of Congress, Avhich declared that “ all claims and proceedings shall cease.” "When the plea only showed that proceedings for limited liability were pending and undetermined in the District Court, probably a stay of proceedings was all' that the defendants could require; but Avhen they set up and produced the final, decree of that court, forever debarring the plaintiffs from prosecuting any claim for damages, they Avere entitled either to a verdict and judgment in their favor, or to a dismissal of the proceedings.

We have assumed in the foregoing discussion that the case of loss and damage by fire on board of a ship is Avithin the provisions of the third and fourth sections of the act of ‘1851. This, hoAvever, is disputed, and it is necessary to examine the question. The.language of the third section (which governs also the fourth) is certainly broad enough to embrace cases of loss by.fire. It declares that the liability of the OAvner or owners of any ship or vessel “for any act, matter or thing, loss, damage, or forfeiture, occasioned or incurred Avithout the privity or knowledge of such OAvner or OAvners, shall in no case exceed the amount or value of the interest of such owner or OAvners respectively in such ship or vessel and her freight then pending.”. Why should liability for loss by fire be excepted

It is true the owners of a ship may desire to contest all ha-' bility whatever, as well as to establish a limited liability

The judgment of the Supreme Judidat Court of Massachusetts is reversed and the cause remanded, with directions to take such further proceedings as ma/y he in accordance with this opinion.

Mr. Justice Field, with whom Mr. Justice Gray concurred, dissenting.

I. am not able to agree with the court in its disposition of this case. As I construe the act of' 1851 to limit the liability of ship owners, the liability of the steamship company for the loss by fire of the goods of the plaintiff below, the Hill Manufacturing Company, rests upon the first section: In my judgment that section is not qualified, nor in any respect af-' fected by the rest of the act; nor is an action to recover for losses by fire, caused by the design or neglect of the owner of. the vessel, controlled by proceedings taken,by him to limit’his-liability for losses from other causes. The opinion of the court proceeds on the assumption that cases of loss and damage by fire are within the provisions of the third section of the act -; it so states expressly. Vet this assumption necessarily involves the conclusion that a fire,-caused by the design or "neglect of the owner, may occur Without his privity or knowledge, -which appears to me, to be nothing less than saying that contradictory and inconsistent terms may be. appropriately applied to the same transaction. 1

The object of the act was to change the rule of the common law as to the liability of the owners of vessels for losses and injuries, to which they did not contribute, either designedly or by their neglect, but which were attributable entirely to the acts or omissions of their officers or employes. The common law

The first section exempts them from all liability for loss or damage by fire of goods shipped on board their vessels, unless such fire is caused by their design or neglect. When the fire is thus caused, the common-law rule of liability remains as before; and that extends to the whole value of the property if entirely lost, or to the extent to which it may be damaged, if only partially destroyed. The concluding provision of the section is equivalent to a declaration that the exemption provided in the preceding part shall not exist when -the fire originated from the wrongful acts or omissions of the owners.

The third section prescribes a limited liability to the owners for losses from a great variety of acts. It does not exempt them from all liability, but restricts it in the cases mentioned to the value of their interest in the vessels and' the freight then pending. It is as follows:

“ That the liability of the owner or owners of any ship or vessel for any embezzlement, loss, or destruction by the master, officers, mariners, passengers, or any other person or persons, of any property, goods, or merchandise shipped or put on board such ship or vessel, or for any loss, damage, or injury by collision, or for any act, matter or thing, loss, damage; or forfeiture done, occasioned, or incurred, without the privity or knowledge of such owner or owners, shall in no case exceed the amount or value of the interest of such owner or owners respectively in such ship or vessel and her freight then pending.”

The fourth section refers' to the acts mentioned in the third, and declares that if any such embezzlement, loss, or destruction, shall be suffered by several freighters or owners of goods on the same voyage, and the whole value of the ship'*'and freight shall not be sufficient to make ¡compensation to each of them, they shall receive compensation from the owner in . proportion

It seems clear that the various cases of damages and losses enumerated in section three ar¿ not intended to embrace losses by fire. This section first speaks of the liability of the owner for embezzlement, loss,-or destruction, by the master, officers, mariners, passengers, or other persons, of property shipped' on board the vessel. It then speaks of his liability for any loss damage, or injury by collision; and, lastly, for any loss by any act, matter, or thing, loss, damage, or forfeiture, done, occasioned, or incurred without his privity or knowledge. It is conceded that the language of the first and second parts of the section does not include losses by-fire, and the language of the concluding clause does not necessarily include them. It may be applied to other cases ; and as losses by fire are specifically embraced by the first section, it must receive such application as will give to each section full force. This is a settled rulé of construction. Besides, it cannot be .contended that an act doné by the design of the owner could have been done without his privity or knowledge. It must necessarily have been done with both; and if the fire was caused by the neglect of the owner it must be presumed to have been caused.with his knowledge. "Where one is bound to do a thing or to see that certain things are done, he is presumed to know the direct consequence of ■ his carelessness and neglect in those respects. Especially is this so where his doing the thing, or seeing that it is done, is necessary to the safety of life or property. He cannot shield himself from responsibility by saying that he did not know what would be the consequence of his carelessness and neglect. The law presumes that he does know it and intends it.- The act speaks of neglect by the owner, not by any sub

Not only would this be unreasonable, but there is an inconsistency in holding that the first section exempts the owner from all liability in cases of fire, happening without his design or neglect, if by the third section a liability is fastened upon him to the extent of the value of the ship and freight in case'of a fire occurring without his privity or knowledge. And yet, according to the position of the court, the owner is exempted by the. first section from all liability if a fire occur without his knowledge and privity, and by the third section is subjected to liability to the extent of the value of the ship.

As stated by counsel of the plaintiff below, there can be no public policy in absolving common carriers by water from their full liability to others for property which has been entrusted to their care, and has been lost by their design or neglect. It certainly would require language, as he observes, so cléar and plain that no subtlety of criticism can escape from the conclusion, before such a purpose, can be ascribed to Congress. It would be establishing a limitation of liability against public policy, common right, and the universal feeling of justice. It would make the law one to protect wrongdoers, and to punish the innocent Avho had been injured by them while thus protected.

If, then, the first section is not affected by the other sections of the act, the liability of the owner of a vessel in case, of fire caused by his design or neglect exists, as it always has existed at the common laAV; and that liability may be enforced in any court, State or federal, having jurisdiction of the parties. The other provisions by which the owner may seek to relieve himself from liability by surrendering his vessel and the freight earned have no application to such a case. It follows that the defence of. a liability limited, as asserted by the ■ District Court, goes to the ground.

There is also another consideration which leads to the same conclusion. By § 9 of the Judiciary Act .of 1189, re-enacted in § 563, clause 8, of the Revised Statutes, a common-law remedy

Por these reasons, I am of opinion that the judgment of the State court should be affirmed, and I am authorized to say that Me. Justice G-bay concurs with me in this conclusion.