(273 F.)

Haight, Sandford & Smith, of New York City, for appellee Koninklijke West Indische Maildienst.

Before WARD, ROGERS, and MANTON, Circuit Judges.

WARD, Circuit Judge. The Morse Dry Dock & Repair Company, owner of the tug Arthur Kill, filed a libel against the steamer Nord Alexis to recover for salvage services. Felix Mouton, claimant of the Nord Alexis, filed a libel against the tug Arthur Kill to recover damages for injuries sustained by the steamer while in tow of the tug. Koninklijke West Indische Maildienst, owner of the steamer Prins Frederik Hendrik, filed its libel against the Nord Alexis and the Arthur Kill to recover for injuries sustained by her in collision with the Nord Alexis while in tow of the Arthur Kill.

By agreement these three cases were tried together, and the District Judge at the close of the trial delivered an oral opinion. He entered a decree: (1) Awarding 5 per cent. of the value of the Nord Alexis and her cargo to the Morse Dry Dock & Repair Company, $10,250 as salvage and $180, with interest, to pay for injuries to the Arthur Kill; (2) dismissing the libel of Mouton against the Arthur Kill, with costs; (3) awarding to the Koninklijke West Indische Maildienst $1,396.56 against the Nord Alexis for injuries sustained by the Prins Frederik Hendrik, and costs to the Morse Dry Dock & Repair Company against the Koninklijke West Indische Maildienst. Mouton, owner of the Nord Alexis, alone appeals.

[1] February 26, 1918, the Nord Alexis was lying to her port anchor on 45 fathoms of chain on Red Hook Flats, within a quarter to a half a mile of the Brooklyn shore. A storm arose from the northwest, and at about 9 a. m. the master paid out to 70 fathoms on his port anchor and let the starboard anchor go with 45 fathoms of chain. At about 9:40 a. m. the chain of the port anchor jumped the wildcat and broke the shackle in the chain locker, which connected it with the chain of the starboard anchor. The weight of the starboard anchor chain on the shackle prevented the port anchor from getting more chain, and the shackle broke under the strain. The port anchor and chain were thus lost, and the sudden strain on the starboard anchor chain caused it to jump the wildcat, and it was also lost, with all its chain. At this time the wind was blowing some 69 miles an hour, with a maximum velocity of 75 miles at 9:30. The steamer's engines could not be used, because a bearing had been broken the day before, taken ashore to be repaired, and had not been returned. All she could do was to let go the kedge anchor, of about 750 pounds. Under the effect of the wind from the northwest, the ebb tide running south, and the drag of the kedge anchor, the steamer began to drift broadside to the wind toward the ferry rack at the foot of Sixty-Eighth street. She blew for assistance. In front of her was the tug Arthur Kill, with a line to the bow of the tug Asa W. Bangs, which tugs were pulling on a hawser to the bow of the steamer Rondo, ashore at the foot of Sixty-Second street. The Arthur Kill dropped her line to the tug Bangs, and the Bangs stopped, so as to let her hawser to the Rondo drop, and let the Nord Alexis drift 273 F.-11

over it. The starboard quarter of the Nord Alexis struck the south side of the ferry rack at the foot of Sixty-Eighth street lightly, and those on board threw a line to persons on the rack, which was there made fast to a pile. The steamer then lay with her starboard quarter against the south side of the rack, angling out into the bay. The slip between Sixty-Eighth street and Sixty-Fourth street is about 400 feet wide, and is occupied by the Long Island Railroad Company float bridges. The only danger the steamer was exposed to was that of being carried by the wind into the slip and into collision with a car float which was lying on the north side of the ferry rack or with the float bridges of the railroad or with the Prins Frederik Hendrik lying alongside the pier at the north of the slip at the foot of Sixty-Fourth street, bow in.

In this situation the Arthur Kill came up on the steamer's starboard bow with a view to holding it up against the wind. The master of the steamer asked the tug to take him up to the south side of the pier at the foot of Sixty-Fourth street and lay him alongside of the Prins Frederik Hendrik. This the tug undertook to do. The steamer cut her line to the kedge anchor, the line to the pile on the south rack parted, and the tug with the best possible disposition pushed the steamer's bow to the end of Sixty-Fourth street and there made fast. She then went between the starboard side of the steamer and the Prins Frederik Hendrik, but was unable for lack of power to hold up the steamer against the wind, and fearing to be crushed between the two, backed out, and the starboard side of the steamer swung under the starboard counter of the Prins Frederik Hendrik, sustaining and inflicting damage.

The storm was violent, but not at all unprecedented. Two such storms are usual in the course of the year. There was some danger to the tug, though, as she was operating on the starboard side of the steamer, she was protected from the storm, and the time of her service was a little over half an hour.

[2] The primary consideration in salvage cases is the amount of benefit conferred. In this case there was none. The only danger to the steamer was that of being carried against the car float on the north side of the south rack, or against the float bridges, or against the Prins Frederik Hendrik. The Arthur Kill, though doing all she could, was unable to prevent the steamer from being driven against the Prins Frederik Hendrik. If we adopt the money award of the District Judge of 5 per cent. on the value of the steamer and cargo, we must at least deduct from it the sum the claimant has to pay to the Prins Frederik Hendrik for her injuries and the cost of repairing her own damage. The tug, having exercised ordinary care and skill, will not be responsible to the claimant of the Nord Alexis, if his damages are more than the sum of $10,250; but she must bear the cost of repairing her own injuries.

The decree is reversed, and the lower court directed to enter a decree in favor of the Morse Dry Dock & Repair Company for so much of $10,250 as may exceed the cost of the repairs to the Nord Alexis and

(273 F.)

also the amount payable to the claimant of the Prins Frederik Hendrik; awarding to the claimant of the Prins Frederik Hendrik the amount of its damages, with interest and costs; awarding to the Morse Dry Dock & Repair Company against the claimant of the Prins Frederik Hendrik its costs in that suit; and dismissing the libel of the claimant of the Nord Alexis against the Morse Dry Dock & Repair Company, with costs.

KELLEY et ux. v. WEST BRADDOCK BRIDGE CO.

(Circuit Court of Appeals, Third Circuit. May 9, 1921. Rehearing Denied June 13, 1921.)

No. 2668.

1. Bridges 15-Ordinance held to recognize right of bridge company to lease bridge.

A borough ordinance granting to a bridge company, its lessees, successors, and assigns, the right to enter upon the streets for the bridge and its approaches, gives to the company, in so far as the borough is concerned, the right to lease the bridge.

2. Courts 367-Decision of state court on powers of state corporation is controlling.

The question of the extent of the powers of a corporation organized under the laws of the state is peculiarly one for the courts of that state to adjudge, and a decision of the highest courts thereof on that question, which has become a rule of property, is binding on the federal court. 3. Bridges 15-Bridge company incorporated in Pennsylvania has authority to lease its bridge.

A corporation organized under Act Pa. June 12, 1879 (P. L. 173; Pa. St. 1920, § 5841), which empowers the company, with the assent of the holders of not less than two-thirds of its capital stock, to sell and dispose of its property, has authority to lease its bridge with the consent of its stockholders; the power to lease being included within the broader power to sell.

4. Bridges 35-Bridge company, which has leased its bridge, is not liable for injuries caused by negligence of lessee.

A bridge company, which had executed a valid lease of its bridge to a traction company and given the lessee exclusive possession thereof, is not liable for injuries to pedestrians resulting from the negligence of the lessee in permitting obstructions to remain on the approaches to the bridge.

In Error to the District Court of the United States for the Western District of Pennsylvania; Charles P. Orr, Judge.

Action by Edward Kelley and wife against the West Braddock Bridge Company. Judgment for defendant on a directed verdict, and plaintiffs bring error. Affirmed.

J. P. Patterson, of Pittsburgh, Pa., and John J. Boyle and Charles Koonce, Jr., both of Youngstown, Ohio, for plaintiffs in error.

Clarence Burleigh and William A. Challener, both of Pittsburgh, Pa., for defendant in error.

Before BUFFINGTON, WOOLLEY, and DAVIS, Circuit Judges.

For other cases see same topic & KEY-NUMBER in all Key-Numbered Digests & Indexes

BUFFINGTON, Circuit Judge. In the court below, Edward Kelley and his wife, citizens of Ohio, brought suit against the West Braddock Bridge Company, a corporate citizen of Pennsylvania. The suit was to recover damages for personal injuries sustained by Mrs. Kelley while passing along the foot passageway of an elevated roadway which was an approach to a bridge over the Monongahela river. The negligence alleged against the bridge company was in placing on the pedestrian footway of such approach a pile of planks from which one protruded and caused the plaintiff's fall and injury. The cause was tried by jury, and at the conclusion of the testimony the court gave binding instructions in favor of the defendant holding that:

"She cannot recover from the defendant here, because the defendant, under proper authority given by the state of Pennsylvania, made a lease of its bridge to the Consolidated Traction Company long before this injury to the plaintiff, and has never afterwards exercised any control over the property which was the subject of the lease of the bridge. The bridge was under the control of the Consolidated Traction Company and then passed by an operating agreement into the control of the Pittsburgh Railways Company."

On entry of judgment on this directed verdict, the plaintiffs sued out this writ of error.

The questions involved in the case are: First, the power of the Bridge Company to lease the bridge and its approaches to the Traction Company; and, second, if it has such authority, is the Bridge Company, which went out of possession, responsible for the subsequent negligent use of the bridge by the Traction Company.

Turning, first, to the right of the. Bridge Company to lease, we note that it was chartered by the state of Pennsylvania, and that on October 24, 1898, the borough of Braddock, by ordinance, granted to it the right to construct this approach to its proposed bridge. By such ordinance the borough gave its consent "to the West Braddock Bridge Company, its lessees, successors, and assigns, to enter upon, use, and occupy for the purpose of its bridge approach the streets, avenues," etc., and stipulated that "said company shall provide and maintain a wagon way and foot walk over said approach for the use of the public," and "no toll whatever shall be charged on the foot and wagon ways," etc., and the bridge was to assume all damages arising "in the use thereof after construction."

[1] It will thus be seen that the locus in quo where the plaintiff was injured was a recognized roadway of the borough, and as between it and the Bridge Company the latter was to properly maintain it. As to what the liability of the borough would have been to a passenger, in case he was injured by negligence of the Bridge Company, or what the liability of the Bridge Company to reimburse the borough in case the latter were held liable for failure to afford a safe passageway, we are not now concerned, for no such question of such liability is here involved. The significance of the quoted language is that the ordinance expressly recognized that the rights of the Bridge Company, so far as the borough was concerned, were assignable; the ordinance being, as noted above, "to the West Braddock Bridge Company, its lessees, successors, and assigns."

(273 F.)

[2] Such being the case, we next inquire whether the Bridge Company had power to lease the bridge and approach to the Traction Company. Both companies being Pennsylvania corporations, the question of their corporate powers is particularly one for the Pennsylvania courts to adjudge, and if the highest courts of that state have decided that question, and it has become a rule of property, their decision is binding upon the federal court sitting in Pennsylvania.

[3] Corporate authority on the part of the Bridge Company to lease its property to the Traction Company is alleged to exist by virtue of the Pennsylvania Act of June 12, 1879 (Pa. St. 1920, § 5841), quoted in the margin. While that act, by its terms, only empowers a sale, we are warranted in assuming that, when it was passed, conferring power on corporations to sell, it was in the mind of the Legislature that such power carried with it the lesser power to lease, for this was the adjudged law of Pennsylvania in the case of Ardesco Oil Co. v. North American Co., 66 Pa. 381, where the Supreme Court in 1870 had held:

"If they can alienate absolutely, they may lease, which is but a partial or temporary alienation."

And this principle has been acted upon by the bar of Pennsylvania to such an extent that to now decide otherwise would unsettle, if not indeed destroy, investments of large value in corporate securities and ownership.

[4] Seeing that the Bridge Company had the consent of the borough to lease and the corporate power to exercise that consent, we next inquire whether, when the Bridge Company granted such lawful lease and gave to the Traction Company exclusive possession of the approach, the Bridge Company was liable for an injury to a passenger using the approach, which was caused, not by any defect in the structure, but in a negligent use by the Traction Company of the approach. As to the liability of the Traction Company to the plaintiff, no question is made, and in point of fact the plaintiffs had sued it and recovered a verdict for the very injury involved in the present case. But not only has the right of corporations to lease where they have statutory powers to sell been, as noted above, adjudged by the Supreme Court of Pennsylvania, but the nonliability of the lessor out of possession for the acts of a lessee in possession has also been adjudged by that tribunal. In that regard, it suffices to refer to Pinkerton v. Pennsylvania Traction Co., 193 Pa. 229, 44 Atl. 284 and Vadas v. Pittsburgh, etc., R. R. Co., 230 Pa. 42, 79 Atl. 166, where it was said:

"The settled principles of law and the decided right of authority are in favor of the rule that when a lease is duly authorized by law there is no further liability on the part of the lessor for negligence of the lessee in the operation of the road."

The judgment below is affirmed.

1 "It shall be lawful for any bridge company, with the assent of the holders of not less than two-thirds of its capital stock, to sell or dispose of its property to any other corporation, and said corporation so purchasing shall have full power, in accordance with the purposes of its charter, to use the property so purchased for the purpose designated in the charter under which said property was built."