I fully agree with the libellant (cross-respondent) that it was not the intention of the parties to terminate the original charter by any redelivery of the vessel to the owner, or otherwise. For one thing, had there been such a redelivery, the vessel could not have been rechartered by the War Shipping Administration except in accordance with the provisions of the Merchant Marine Act of 1936, 46 U.S.C.A. § 1101 et seq., and the President's Executive Order No. 9054 of February 7, 1942, 50 U.S.C.A. Appendix, § 1295 note. Clauses (e) and (f) of Part I of the Amended Charter, which called for the designation of a 'port of delivery' and a 'time and date of delivery', were intended merely to fix the port, time and date at which the Amended Charter became effective. If there is any doubt about this, it is resolved by the letter of August 10, 1945, from the War Shipping Administration to the owner, expressly agreed to by the owner, in which the parties adopt this construction of the delivery clauses of the Amended Charter.
Thus, when the Point Breeze arrived at Philadelphia she had not been redelivered to the owner but the changes in the charter, effected on August 4, 1944, were in force. There having been no redelivery by the charterer to the owner and no subsequent new placing of the vessel at the disposal of the charterer, Clause 1 of the Amended Charter did not have any application and the whole contention of the government and the government's claim to damages based on the fact that the vessel was not, on August 4, ready to receive cargo and fitted out for normal service cannot be considered. Even if it could, it would be more than questionable whether, in view of the fact that the condition of the vessel was fully known to the government when the Amended Charter went into effect, it could be sustained. Moreover I have already found that the breakdown of the generator and its consequent defective condition on August 4 was not caused by or due to any lack of due diligence on the part of the owner.
Only two clauses of the Amended Charter have any application to the situation presented by the government's claim. Clause 8(c) provides for a reduction in charter hire in the event that the vessel is physically incapable of working for a period in excess of 20 days while in a continental United States part. Clause 12 provides for dry-docking for the purpose of cleaning and painting, clearing the vessel of oil and gas and places the expense and port charges incurred for these operations upon the owner. It significantly does not, as does Clause 12 of the 1942 charter, provide for suspension of charter hire as well. The Point Breeze was certainly physically incapable of working during the time required to repair the generator (August 10 to September 8) and I think that she was also physically incapable of working within the meaning of Clause 8(c) as long as she was dry-docked for cleaning, painting and other necessary repairs incident to her annual inspection. Consequently, the reduction in charter hire should be computed in accordance with Clause 8(c) of the Amended Charter.
The libellant (cross-respondent) contends that this Court is without jurisdiction to consider the claim made in the cross-libel, basing its contention upon the well recognized rule that courts of admiralty, although conforming to equitable principles in the disposition of matters before them, are without jurisdiction to enforce the equitable remedy of account.
In both the libel and cross-libel the principal issue before this Court arises out of alleged failure on the part of the owner to exercise due diligence, in other words, breach of a term of the charter, a maritime contract, and within the Court's admiralty jurisdiction. In the libel the breakdown itself gave rise to the set-off claimed by the respondent. In the cross-libel the overpayment which the government seeks to recover is alleged to have been occasioned by the fact that the term of the charter, to the effect that the vessel would be seaworthy on delivery so far as due diligence could make her, was breached by the broken-down generator, giving rise to a claim for damages which the government mistakenly failed to set off against hire. The account between the parties is no doubt complicated but there seems to be no dispute as to any item in it and I see no reason why the Court has not jurisdiction of these two isolated claims which are susceptible of exact determination and adjudication without reference to any other items of debit and credit between the parties and which arise out of a maritime contract.
A decree may be presented in accordance with the foregoing.
Section 3 of the Suits in Admiralty Act, 46 U.S.C.A. § 743, provides that a decree against the United States may include interest. Conceding that the matter lies in the discretion of the Court, the libellant argues that interest in admiralty causes is invariably allowed in the absence of a specific reason for its disallowance. That is a pretty broad statement, but accepting it for this discussion, there is certainly in this case a specific reason for disallowing interest.
The Second Disputes Addendum dated January 10, 1945, Part III, Article Third, which amends the charter and governs the contractual relations between the parties, provides 'No interest * * * shall become due or payable by the Charterer by reason of delay in payment of any charter hire or any other sums accruing under this Charter * * * ' The libellant's argument that this means 'mere' delay and does not apply to a case in which a charterer has denied liability and refused to pay cannot be sustained. The addendum dealt with disputes and with nothing else and when the parties referred to delay in the payment of charter hire they must have had in mind delay by reason of a dispute. Of course, disputes almost always involve denial of liability and refusal to pay at least some part of a sum of money claimed. A provision for delay in cases of mere neglect or inadvertence to perform an admitted obligation would have no place in a special contract dealing with the subject of disputes.
Even if the word 'may' in Section 3 of the Suits in Admiralty Act had been 'shall', I see no reason why the owner by contract could not have waived interest.
The final decree will be entered without interest.
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