RICHMOND DREDGING CO. v. STANDARD AMERICAN DREDGING CO. et al., 208 F. 862

WOEVERTON, District Judge (after stating the facts as above). In the nature of the controversy the first question logically arising for decision is the one suggested by the respondent the Standard Company, namely, that admiralty has not jurisdiction of the cause. In support of wliat is alleged touching the nature of the craft, it is shown by the testimony of H. C. Cutting, president of the libelant company, that her dimensions are length 75 feet, beam 30 feet, and draws 4y2 feet of water; .that she has a srtperstructurc containing machinery, pilot house, galley, messroom, and cabin accommodations for crew.

The witness further testifies that she “operates afloat and not otherwise” ; that “she was built for the purpose of dredging a ship canal at Richmond and cleaning her out — her occupation is to clean out canals and harbors and to make fills”- — that “since her construction she has never been operated otherwise than afloat”; and that “she is equipped to navigate any place if you have a mind to take her. She has made one ocean voyage.” The voyage referred to is one whereby she was taken from San Francisco Bay to Humboldt Bay and returned. The testimony of R. A.

Perry, the president of the Standard Company, does not differ materially from that of Cutting as to the nature of the dredger, although he goes more extensively into the manner of her operation while at work. The case of North American Dredging Co. v. Pacific Mail S. S. Co., 185 Fed. 698, 107 C. C. A. 620, decided by this court, is in such close analogy to this, as it pertains to the character of the dredger in controversy, as to be controlling here. Without discussing the cases therefore or attempting to analyze them, we hold that the craft in question is the subject of admiralty jurisdiction.

The next question presented for our decision is whether the respondent the Standard Company was entitled to the possession of the Richmond No. 1 at the time this libel was instituted and the draft was-delivered’to it by the marshal in pursuance of the bond and the order o-f the court. This depends upon the construction of the charter party of February 26, 1910. The libel was filed September 2, 1910, and was released to- the Standard Company September 13th on its admiralty stipulation and tlie giving of the bond noted in the statement.

The evidence further shows the return of the dredger Oakland was demanded by the Standard Company August 15, 1910. The Richmond Company returned the Oakland the next day, and at the same time made demand upon the Standard Company for the return to it of the Richmond No. 1, all in pursuance of the libelant’s understanding of the provisions-of the charter party of February 26, 1910.

Paragraph 8 of the charter party contemplates an extension of the terms of the lease upon the Oakland 'at the option of the Richmond Company, provided the Standard Company shall not have found any work for the dredger to do-, the extension to run until the Richmond Company shall have completed the filling therein designated, “or until the party of the first part (the Standard Company) shall have given the party of the second part (the Richmond Company) fifteen (15) days’ notice of the termination of this agreement.” This gave the Standard Company the option to terminate the agreement notwithstanding the Richmond Company had not yet completed the filling specified.

The ninth paragraph then specifically sets forth how and in what manner the Standard Company might terminate the agreement if during the term or any extension thereof the Standard Company should secure work for the Oakland. By this paragraph the Standard Company was accorded an option either to require the Richmond Company upon giving 15 days’ notice to that effect to operate the dredger Oakland 24 hours each day until the specified filling was completed, or to terminate the lease of the dredger Oakland by giving also 15 days’ notice of such termination and -returning the dredger Richmond No. 1.

The Standard Company chose to exercise the option for a termination of the lease of the Oakland, for it gave the notice demanding her return, but it refused to return tlie Richmond No. 1 to- the Richmond Company.

The respondent claims that under the stipulation of this paragraph it yet had another option, either to return the Richmond No. 1 or to keep it and pay an increased rental, namely, $50 per day so long as it desired to use the same. .Tt must be admitted that the stipulation running “or paying the party of the second part fifty (50) dollars per day’5 lends color to that contention, but when read in connection with paragraph 10 it can be given no such construction.

By the latter paragraph the Standard Company is given the right to lease Richmond No. 1, “at any and all periods when not in use or required by the party of the second part until January 1, 1911.” Now, it could not well be the intendment of the charter party to give this right of leasing at $800 per month, dependent on the Richmond Company not requiring its use, and at the same time give the Standard Company the right to retain the dredger at any rate on paying to- the Richmond Company $50 per day.

In other words, an option extending to both parties the right to require and use the dredger at one and the same time is utterly inconsistent and must be harmonized upon some other basis. Considering these conditions together with the general provisions of the several charter parties, and the treatment by the parties thereto of the dredgers Oakland and Richmond No. 1, we are of the opinion, as the District Court decided, that the stipulation for the payment of $50 per day was intended as liquidated damages in case the Richmond was not returned when the possession of the Oakland was demanded.

When the Oakland was returned in pursuance of the Standard Company’s demand, the Richmond Company was entitled to the return of the Richmond No. 1. Ribelant was therefore entitled to the possession of the Richmond No. 1 at the time of the filing of this libel. It also follows from these considerations that the libelant was entitled to recover $50 per day for the retention of the Richmond No. 1 up until the 3d clay of February, 1911, when the boat was tendered back by the Standard Company, and was refused by libelant.

It could not recover more than this because it was its duty to accept the dredger, the same being as we find on a careful review of the testimony, in a condition contemplated by the charter party when return should be made. We are also of opinion, in view of the whole case, that the Standard Company is not entitled to anything as reimbursement for expenses of a caretaker after tender of the Richmond No. 1 to libelant.

The question is presented as to whether the two Atlas gas engines which were installed upon the dredger by the Standard Company after coming into its possession under the charter party became a part of the vessel and were not subject to- removal before returning her to the lessor. The record shows that when the Standard Company received possession the dredger was equipped with two Sampson engines of a capacity each of 75 horse power. They had been previously used and needed repairs. Repairs were made by the lessee, but when repaired it was found that they developed in the aggregate 110 to 115 horse power only.

To supplement these Sampson gas engines a steam engine was first installed to run the cutter. Rater while the dredger was at work under contract at Eureka, electric motes were installed without removing the gas engines, which did all the work of running both the cutter and the pump. In the meantime the gas engines were not operated at all. Still later, viz., on May 28, 1910, the Standard Company began work upon a contract at Alameda. Erom that time for a week or perhaps longer the Sampson gas engines were used.

In the meantime, however, the Standard Company leased of the Atlas Gas Engine Company an engine and installed it anticipating heavier work under a contract to be undertaken at Walnut Grove. This was installed by bolting it on the deck of the dredger, using some timbers perhaps as a base for the purpose. A little later another Atlas gas engine was leased from the California Reclamation Company and taken from the launch Wink and installed, and the Sampson engines were removed from the dredger and rendered no further service.

After the Standard Company completed its work at Walnut Grove, and subsequent to the pendency of the libel, the Atlas gas engines were detached and the Sampson engines reinstalled, the same being put in as good condition as they were first received by the Standard Company, the usual wear and tear excepted, and.were in this condition when the dredger was ■ tendered back to the libelant.

The testimony upon this subject is very lengthy, entering into the minutest detail; whether material or immaterial, relevant or irrelevant, and without attempting to set it forth here or otherwise analyze it, it suffices that we have examined it with care, and find the above to be reasonably deducible as proper conclusions of fact therefrom. These Atlas gas engines never became or were the property of the Standard Company, and as a legal conclusion we find that they never became a part of the Richmond No. Tas equipment or otherwise.

They were temporarily installed only to take the place of the Sampson gas engines for the time being, and the Standard Company was entitled to detach them and reinstall the Sampson engines. Nor do we think that the terms of the respondent’s bond require it to return the dredger to libelant with the Atlas gas engines as a part of its equipment.

True the bond requires the return of the dredger “in the same condition in which she is now,” but it furthermore requires that the respondent “shall abide by and perform the decree of this court,” and, the decree of the court being that the Atlas gas engines were not a part of the equipment of the dredger which the respondent was bound to return to the Richmond Company by virtue of the stipulations of the charter party, the bond was satisfied when the conditions of the charter party were complied with.

This leaves but one other question for consideration, which is whether the District Court erred in sustaining the exceptions to the second and fourth claims of damages in the supplemental libel. We think there was no error in that regard. The charter party by legal intendment covers the character of damages sought to be recovered by these claims, when it is construed as we have construed it that the stipulation for the payment of $50 per day was intended as liquidated damages for the wrongful withholding of the dredger from libelant.

These considerations lead to an affirmation of the decree of the District Court, and such will be the order of this court, with costs of appeal to the appellees.