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Opinion of the Court.
of the well-settled nature of the general rule at the time the statute was adopted, it must result that legislative approval was by clear implication given to the general rule as then existing in all cases where it was not changed." The Kensington, 183 U. S. 263, 268-269. Our question therefore is whether the language of the Harter Act, substantially reenacted in the Carriage of Goods by Sea Act, has carved out a special statutory exception to the general rule so as to permit a carrier to deprive its cargo owners of a part of the fruits of any judgment they obtain in a direct action against a noncarrying vessel that contributes to a collision.
Prior to the passage of the Harter Act in 1893, cargo damages incurred in a both-to-blame collision could be recovered in full from either ship. The Atlas, 93 U. S. 302. The Harter Act, under some circumstances, took away the right of the cargo owner to sue his own carrier for cargo damages caused by the negligent navigation of the carrier's servants or agents. It did not deprive the cargo owner of his tort action against the noncarrying ship. The Chattahoochee, 173 U. S. 540, 549–550. Nor did the Harter Act go so far as to insulate the carrier from responsibility to another vessel for physical damages caused to the ship by negligent navigation of the carrier's servants or agents. In The Delaware, 161 U. S. 459, 471, 474, this Court declined to give the Harter Act such a broad interpretation even though the language itself, if "broadly construed" and considered alone, would have justified such an interpretation. In addition, the Harter Act does not exonerate the carrier from its obligation to share with the noncarrier one-half the damages paid by the noncarrier to the cargo owners. The Chattahoochee, supra, at pp. 551-552; see also Aktslsk. Cuzco v. The Sucarseco, 294 U. S. 394, 401-402.
Apparently it was not until about forty years after the passage of the Harter Act that shipowners first attempted
Opinion of the Court.
by stipulation to deprive cargo owners of a part of their recovery against noncarrying ships. See The W. W. Bruce, 14 F. Supp. 894, rev'd on other grounds, 94 F. 2d 834. The present effort of shipowners appears to date from 1937 when the North Atlantic Freight Conference adopted the "Both-to-Blame" clause. So far as appears, this is the first test of the legality of the clause that has appeared in the courts. When Congress passed the Carriage of Goods by Sea Act in 1936, it indicated no purpose to bring about a change in the long-existing relationships and obligations between carriers and shippers which would be relevant to the validity of the "Both-to-Blame" clause. At that time all interested groups such as cargo owners, shipowners, and the representatives of interested insurance companies were before the congressional committees. Although petitioner and respondents both appear to find comfort in the language and the hearings of the 1936 Act, nothing in either persuades us that Congress intended to alter the Harter Act in any respect material to this controversy.
Petitioner argues that the clause does nothing more than remove an "anomaly" which arises from this Court's construction of the Harter Act. It is said to be "anomalous" to hold a carrier not liable at all if it alone is guilty of negligent navigation but at the same time to hold it indirectly liable for one-half the cargo damages if another ship is jointly negligent with it. Assuming for the moment that all rules of law must be symmetrical, we think it would be "anomalous" to hold that a cargo owner, who has an unquestioned right under the law to recover full damages from a noncarrying vessel, can be compelled to
Robinson, Admiralty, 872, 873; Knauth, Ocean Bills of Lading (3d ed. 1947), 95, 136, 175.
8 * Hearings before Senate Committee on Commerce on S. 1152, 74th Cong., 1st Sess.
FRANKFURTER, J., dissenting.
give up a portion of that recovery to his carrier because of a stipulation exacted in a bill of lading. Moreover, there is no indication that either the Harter Act or the Carriage of Goods by Sea Act was designed to alter the long-established rule that the full burden of the losses sustained by both ships in a both-to-blame collision is to be shared equally. Yet the very purpose of exacting this bill of lading stipulation is to enable one ship to escape its equal share of such losses by shifting a part of its burden to its cargo owners.
Here, once more, "we think that legislative consideration and action can best bring about a fair accommodation of the diverse but related interests" of the varied groups who would be affected by permitting carriers to deviate from the controlling rule that without congressional authority they cannot stipulate against their own negligence or that of their agents or servants. If that rule is to be changed, the Congress, not the shipowners, should change it.10
MR. JUSTICE FRANKFURTER, whom MR. JUSTICE BURTON joins, dissenting.
Only a few weeks ago this Court reversed a unanimous opinion of the Court of Appeals for the Fourth Circuit which had held opposed to public policy, agreements whereby retailers of eyeglasses turned over a portion of
Halcyon Lines v. Haenn Ship Corp., 342 U. S. 282, 286.
10 We have not overlooked the argument that this bill of lading stipulation should be upheld because of this Court's holding and opinion in The Jason, 225 U. S. 32. The Jason case upheld a stipulation that both shipowner and cargo owner should contribute in general average on account of sacrifices and expenses necessarily incurred by the master of the ship in order to preserve the cargo as a whole. Moreover, this general average clause "was sustained because it admitted the shipowner to share in general average only in circum
FRANKFURTER, J., dissenting.
the purchase price to the oculist who referred the customer to them. In so doing, "we voice [d] no approval of the business ethics or public policy involved" in the agreements. Lilly v. Commissioner, 343 U. S. 90, 97. This refusal to make our private views of right into the legal standards for the activities of men of affairs has increasingly characterized our decisions in the vague and shifting area of agreements challenged as unenforceable because offensive to what must be deemed to be legally controlling policy. "In the absence of a plain indication of that [dominant public] policy through long governmental practice or statutory enactments, or of violations. of obvious ethical or moral standards, this Court should not assume to declare contracts of the War Department contrary to public policy." Muschany v. United States, 324 U. S. 49, 66-67. No more unrestrained justification warrants courts to strike down private business agreements. Judged by such a standard, the agreements before us should be enforced.
Before 1893, when the Harter Act1 was passed, the obligations of seagoing carriers with respect to passengers and cargo were defined by this Court in the exercise of its admiralty and maritime jurisdiction from case to case. Toward cargo the ocean carrier stood in the relation of an insurer, liable for any damage save that caused by act of God; and to passengers it owed the duty of highest care. Only by holding carriers to this mark was it thought that
stances where by the Harter Act he was relieved from responsibility." Aktslsk. Cuzco v. The Sucarseco, 294 U. S. 394, 403. Here the shipowner attempted to relieve itself from responsibility for negligence of its employees in connection with damages inflicted on another ship "circumstances where by the Harter Act he was [not] relieved from responsibility."
1 Act of Feb. 13, 1893, 27 Stat. 445. The Act has now been superseded by the Carriage of Goods by Sea Act of 1936, 49 Stat. 1207, 46 U. S. C. § 1300 et seq., but any changes are not relevant to the issues here involved.
FRANKFURTER, J., dissenting.
safety in operation could be achieved and undue imposition by carriers eliminated.
The carriers sought to avoid these obligations by special contracts or stipulations in bills of lading, relieving them of liabilities which they would incur under the rules laid down by the courts in the absence of such agreements. Although the courts upheld some such efforts, they reserved the right to refuse to enforce contractual exemptions from liability which trenched upon judicial notions of public policy. The most important limit thus set to the power of the carrier to contract out of his commonlaw liability was the rule that courts would strike down any stipulation which relieved the carrier for hire from liability for damage caused by its own negligence. Applied first by this Court to the railroads, Railroad Co. v. Lockwood, 17 Wall. 357, the doctrine was extended to carriers by sea a few years later in Liverpool & Great Western Steam Co. v. Phenix Ins. Co., 129 U. S. 397. Underlying the decision was the premise that such an agreement, if enforced, would tend to relax the vigilance and care in seamanship which the threat of liability encouraged. See Railroad Co. v. Lockwood, supra, at 371, 377–378.
The process by which this body of rules and exceptions was developed is typical of the growth of judge-made law in our system. Without legislative guidance, judges in deciding cases are necessarily thrown upon their own resources in ascertaining the public policy applicable to particular situations.
2 The courts based this reservation upon the observation that such contracts were not in fact consensual agreements. The shipper had little choice but to accept the carriers' terms. See, e. g., Railroad Co. v. Lockwood, 17 Wall. 357, 379; Liverpool & Great Western Steam Co. v. Phenix Ins. Co., 129 U. S. 397, 441. This circumstance did not necessarily void the agreement, since many stipulations were upheld. But it provided justification for refusing to enforce those which offended judicially pronounced public policy.