In Admiralty. The Mutual Safety Ins. Co., and others, v. The Cargo of the Ship George. George on account of a voluntary stranding of the vessel to save it from foundering in consequence of a leak at sea. The underwriters had paid a total loss on the vessel and freight, and received an abandonment.

It is unnecessary, in this view of the case, to examine the right of Thomas Lynch to the premises in question.

The complainants bill must be dismissed. The question which I have discussed and decided, was new in our courts. For this reason, and others that arise upon the merits of the case, I will give no costs to the defendants.

IN ADMIRALTY:

The facts are as follows:

The George being insured by the libellants, (all the three companies having underwritten the vessel to the valued amount of twelve thousand dollars-four thousand dollars each, and the Mutual Safety Insu

U. S. DISTRICT COURT FOR THE SOUTH- rance Company having underwritten the

ERN DISTRICT OF NEW YORK.

Before the Hon. SAMUEL R, BETTS, D. J.

THE MUTUAL SAFETY INSURANCE COM-
PANY, THE AMERICAN INSURANCE COM-
PANY AND THE JACKSON MARINE INSU-

RANCE COMPANY V. THE CARGO OF THE
SHIP GEORGE, AND THE PROCEEDS THERE-
OF-REYER & SCHLICK, OF TRIESTE, Jo-
SIAH MACY & SON, AND BARCLAY &
LIVINGSTON.

CONTRIBUTION.

The ship George, which was insured by three several Companies, sailed in May, 1841, from New Orleans for Trieste with a Cargo of Cotton, consigned to R. & S. When she had been out

a few days she met with heavy weather and sprung a leak. The leak increased and the Captain after a fruitless attempt to make the harbor of Nassau, in order to save the Cargo from foundering, ran her ashore on a Reef. The vessel and

freight were lost, and after abandonment to the Underwriters, a total loss was paid them. A large portion of the Cotton was saved, and the proceeds came to the hands of M & Son, as the Agents of R & S. On a libel filed on the ground that the proceeds of the Cargo were bound to contribute, held, that the Underwriters by abandon

ment became clothed with all the rights of the insured in respect to the general average, that a court of admiralty would enforce the lien, and that the proceeds of the Cargo might be pursued by libel or petition to recover general average. The voluntary stranding of a vessel by the master to save the Cargo, is ground for a general aver

freight to the amount of $4400, on a valuation of $6800,) sailed in May, 1841, from New Orleans for Trieste, with a cargo of Cotton consigned to the Respondents Reyer & Schlick. When about six days out the vessel met with heavy weather, and sprung a leak. The leak increased, and the captain after making a fruitless attempt to make the harbor of Nassau, finally, in order to save the vessel and cargo from foundering ran the George on shore on a reef about three quarter of a mile from the shore at the West End of the Grand Bahamas.

The vessel and freight were wholly lost, and after abandonment to the underwriters a total loss was paid by them.

A large portion of the cotton was saved, and the proceeds came to the hands of the Defendants Macy & Son, as Agents of Reyer & Schlick.

This libel was now filed on the ground that the proceeds of the cargo were bound to contribute in general average to the loss of the vessel and freight.

A foreign attachment was prayed for against the Defendants, Reyer & Schlick. There was little dispute on the facts.

The answer of Barclay & Livingston, the Agents of Reyer & Schlick, insisted that the vessel was run on shore to save the lives of the master and crew, and that the most expedient course had not been pursued in running the vessel on shore. The answer of J. Macy & Son admitted the fund in their hands.

The only witness examined was Thos. S. Minott, Master of the George. He testified that between the 17th and 22nd of May the leak had averaged from 200 to 1200 strokes per hour, that the water was four feet in the hold, and increasing, when he determined on the 28th to run her ashore. The wind was light with little sea. He testified positively that he ran

In Admiralty. The Mutual Safety Ins. Co., and others, v. The Cargo of the Ship George. the vessel ashore to save vessel and cargo, | Insuruance 580; Browne's Adm. Law; De and that he did not consider any life in Lovis v. Boit, 3 Talleson 398. danger, as they had good boats and the weather was moderate. That if the cargo had been thrown overboard the leak might have been stopped, if it was in the upper works, but he did not know where it was. That he thought there was a chance, although a small one, of keeping the vessel free, even without running her ashore or throwing over cargo. That he selected the place of running her ashore with the view, and in the hope of saving both ship and cargo.

In Bankruptcy.-In the Matter of Reed, a Bankrupt.

court is competent to make it, Bermuda bellants are entitled to recover against the is the proper place of adjustment, and there is no evidence of the law there. (The learned counsel commented at length on the statement which had been made, citing: 2 Phillips 141 to 167.)

claimants, and against the proceeds of the cargo owned by them, and saved from the wreck of the ship George a contributory part on general average in the proportion the value of the cargo saved, bore to the cargo on board paying freight.

BETTS, D. J. —The undersigners, by the abandonment, became clothed with all the And it is further considered by the court, rights of the insured, in respect to contribu- that the libellants, for the purpose of such tion in general average. (2 Phil. Ins. 322.) contribution, are entitled to have the ship The cargo is bound to the vessel to sat- and freight valued at the sums respectively isfy such contribution, and courts of ad- named in the policies in the pleadings miralty will enforce the lien, it being of a mentioned, deducting in respect to the maritime character. The proceeds of car- ship a reasonable allowance for tear and go may be pursued by libel or petition to wear on the voyage up to the time of the recover general average. (Stevens on Av. disaster, and all sums received on sale 25; Dunlap, p. 57, 4 Wash. R. 99, 100.) thereof, or any part of her tackle or apAs a general rule, when admiralty has parel, at the place of wreck or elsewhere. jurisdiction in rem, or over the subject. And it is further considered by the matter, it can be exercised against what-court, that the goods of the claimants ever represents the thing, or to which it may be changed or converted; and is exercised by monition, &c., against those who hold the proceeds. (5 Peters 675.)

The voluntary stranding of a vessel by the master, to save the cargo, is ground for a general average, although the vessel be totally lost. (Abbott 349, note 1; 3 Wash. C. C. R. 398; 13 Peters 331.)

The rule adopted by the state court, (9 John R. 9,) does not control here.

saved, pay contribution according to the prices at which the same were sold at Nassau, deducting therefrom, salvage and other necessary charges, and if it be found that such prices are below the average invoice prices of said goods, or the valuation thereof in the policies of insurance, that, then the residue of the cargo paying freight be valued for the purpose of adjusting the average contribution, at the same rate or proportion.

And it is ordered by the court, that it

In commercial and maritime cases, the U. S. Courts, are not governed by the lo-be referred to the clerk, (or to an auditor cal law, but administer the general law. (16 Peters 1.)

The owners of the ship so lost are entitled to contribution on the freight as well as the cargo. (13 Peters 344.)

The adjustment of average, in case of sale of the goods at the place of disaster, and before reaching the port of destination, may be in relation to the sale price. (Benecke 289.) General rule of adjustment is explained. (Stevens 122, 167; 3 Kent 343; Abbott, 3677. [Other points in the case were noticed by the court, and disposed of in the decree.]

to be named and designated by consent of the proctors of the respective parties,) to adjust and state the average contribution against the claimants, conformably to the principles of this decree, and that on such reference, the testimony used in this cause, and such other evidence as may be pertinent and competent, may be offered by either party, subject to all legal objections.

IN BANKRUPTCY.

U. S. DISTRICT COURT.—VERMONT DIST.
Before the Hon. SAMUEL PRENTISS, D. J.

THE FOLLOWING DECREE WAS MADE BY THE IN THE MATTER OF TIMOTHY REED, A

BANKRUPT.-October Term, 1844.

ATTACHMENT ON MESNE PROCESS.

attachment on mesne process gives the creditor

a lien on the property attached and is within the saving clause of the Bankrupt Act.

The doctrine of Kittredge v. Emerson, (ante p. 107,) affirmed.

THIS was an application by Timothy

In Bankruptcy. In the Matter of Reed, a Bankrupt.

PRENTISS, J.-Three objections are interposed to the allowance of a discharge to the bankrupt. The first alleges a fraudulent concealment of property, by wilfully omitting to insert in his schedule several articles of personal property particularly enumerated and specified. This objection requires no further notice than to say, that it is not supported by the proofs.

Reed, a bankrupt, for a discharge. The of the bankrupt, being the same estate alfacts in the case, as well as the objections leged in the objections to have been confiled by the opposing creditors, will suffi- veyed and transferred to them. The suits ciently appear from the opinion delivered were instituted for the joint benefit of the by the court. several attaching creditors, under an understanding that the avails of the property attached should be divided among them in proportion to their respective debts; and without, as some of the creditors who have been examined as witnesses say, the procurement of the bankrupt, or any concert whatever with him. The personal property, thus attached, consisted of horses, cattle, sheep, hay, grain, and farming utensils, and was sold by the attaching officer at public auction, after being regularly advertised, on the 27th of January, before judgment, with the consent of the bankrupt and the creditors in writing; and the avails of the property so sold were afterwards apportioned among the several ereditors according to the understanding existing between them, judgments being obtained for the debts in suit by confession. The bankrupt, on application of the creditors, quitclaimed to them all his interest in the real estate attached, consisting of an equity of redemption, worth, according to the estimate made, about $186.

The second and third objections may be considered together; the one alleging various fraudulent conveyances and transfers, without any adequate or valid consideration, to certain individuals named in the objections, of real and personal estate to a large amount, within the second clause of the second section of the bankrupt act; the other alleging the giving of fraudulent preferences to the same persons, by the conveyances and transfers of the same property, within the first clause of the same section of the act.

doubt of the integrity or fairness of the transactions, considered independent of the bankrupt law, although the creditors thereby obtained a preference. Whether the transactions constitute such a preference as the law forbids, is the question which remains to be considered.

It should be observed here, for the sake of proper discrimination and distinctness, The testimony is very full to show, that that much of the testimony taken in the the attaching creditors were bona fide credicase, which, by-the-by, is quite volumin- tors to an amount greatly exceeding both the ous and presents a variety of transactions, proceeds of the personal property and the has no direct application to any of the ques-value of the interest in the real estate; and tions arising out of either of the objections. from the facts proved, there can be no The inquiry, by the rules and practice of the court, is limited to such transactions as are embraced in the objections, and to them the testimony should, regularly and properly, have been confined. At any rate, all beyond, if not wholly irrelevant to the matter in issue, cannot be considered as having any other purpose or effect, than As the bankrupt, at the time of the atthe general one, to show the state and con-tachments, was deeply insolvent, his real dition of the bankrupt's affairs at the time the conveyances and transfers were made which form the stated grounds of objection. Passing by, then, such of the testimony as appears to have no direct bearing upon the objections, the material facts, necessary to be adverted to, are these: On the 10th of January, 1842, after the bankrupt law was passed, but before it went into operation, the several persons mentioned in the objections, being creditors of the bankrupt, instituted suits on their respective debts, and attached all the real and personal estate

estate being incumbered by mortgages to a heavy amount, and owing, as he did, other debts far beyond his means of payment, the case would be a clear one against him, if there was any evidence of a collusion between him and the attaching creditors, or such collusion could be fairly inferred from the transactions themselves. But instead of there being any such evidence, or any such inference being allowable, the testimony shows that the attachments were wholly and exclusively at the instance of the creditors, and that the proceeding on

In Bankruptcy.-In the Matter of Reed, a Bankrupt.

that the lien is unconditional, but that it is complete and perfect as a lien, during its continuance, as much so as a lien by judgment or any other lien. It is created by the attachment, and derives its force and efficacy from the attachment. It exists anterior to, distinct from, and independent of the judgment, and is for the express and specific purpose of giving to the creditor a security for his debt in advance of the judgment. A judgment, to be sure, is necessary to enable the creditor to avail himself of the benefit of the lien, and so is an execution; but the lien is created and exists anterior to either, and is perfect and valid as a lien or security ab initio, and must remain so until the creditor has failed to obtain judgment, or to levy his execution within the time prescribed by law, or the judgment is satisfied by payment. No lien whatever upon property is an absolute indefeasible interest in the property, but all liens are in their nature defeasible. A mortgage is a conditional lien or security, defeasible by payment. So a lien by bottomry is in the highest sense conditional and contingent, being dependent for its effect on the return of the ship. If the ship returns, the lien becomes effectual; if the ship fails to return, the lien is ineffectual. It is admitted by all that the lien by bottomry is within the saving provision of the bankrupt act; and yet it is not only conditional, but requires, as a mortgage also does, the aid of a judicial decree and process to enforce it.

their part was really and altogether adverse. We have only to consider, then, the nature and extent of the right acquired by the creditors by virtue of the attachments, and the effect of the bankrupt's consent to the sale of the personal property before judgment, and of his quitclaim of his interest in the real estate, connected with the fact of his confessions of judgment in the suit. I have no disposition to enter into any further discussion of the question, whether an attachment is a lien within the saving clause of the bankrupt act. The question has been already sufficiently discussed by the courts of the United States, here and elsewhere, and must be considered as settled, in this district at least, by the cases of Downer v. Brackett, 5 Law Reporter, 392; Haughton v. Eustis, 5 Law Reporter, 505; and the matter of Rowell, 6 Law Reporter, 298. These decisions have been followed up by a decision of the supreme court of this state to the same effect, made in December last, but not yet reported; and by a corresponding determination of the Supreme Court of New Hampshire in the case of Kittredge v. Warren, 7 Law Reporter, 77. The concurrence in these two states of their highest courts upon the same question, composed, as the court in each state is, of judges of large experience, sound judicial discretion, and acknowledged learning and ability, whose opinions are entitled to great weight upon any question, and especially upon one depending mainly upon local law, such as the nature and effect of an attachment, would seem to be In the matter of Cook, 5 Law Reporter, confirmation, quite sufficient, of the deci- 443, a distinction is assumed to exist, besion first made upon the question in this tween the case of a lien by attachment becourt and afterwards affirmed in the circuit fore judgment, and the case of a lien by atcourt. Still, however unnecessary or un-tachment after judgment. It is there held, called for it may be, I will advert in a very few words to one or two isolated points, intending by no means to go into the general argument.

It is said that an attachment is a conditional contingent lien, dependent on the judgment in the action; and being thus conditional and contingent, it is not a lien within the meaning of the bankrupt law. It is true that an attachment is dependent for its final effect on the result of the suit and other proceedings to be had; and so far, and in that sense, the lien is conditional and contingent. But it is not on that account any the less an absolute and fixed lien. By the term absolute, I do not mean

that where judgment has been obtained before the commencement of the proceedings in bankruptcy, the lien is valid, and unaffected by the bankruptcy. But how can that be, unless the lien, as a lien, is saved by the act; and if it be saved, it is quite immaterial whether the judgment is recovered before pending or after the proceedings in bankruptcy. It seems to be supposed, and indeed is distinctly asserted by the court, that by the judgment the nature of the lien is altered and changed, so that the right of the creditor under the attachment, from being conditional and contingent, becomes, by operation of the judgment fixed and absolute; that is, as I un