The law of the sea

by George L. Canfield; J. Y. Brinton; George W. Dalzell

If the owner be a corporation, the control of the vessel is usually directed by the Board of Directors, as in the case of other corporate enterprises, though the holders of a majority of the capital stock may determine the disposition of the vessel and all matters relating to her, by voting their stock at regular or special stockholders' meetings, called in accordance with the company's charter and by-laws and the laws of the state in which the company is incorporated.

5. Minority Interest.—

The minority interest, where the majority sends out the ship against its wishes, may compel the majority to give a bond for its safe return or the payment of the value of its interest. This may be obtained through a court of admiralty. When such security is given the dissenting owners, they are not entitled to compensation for the use of their shares or to any portion of the profits. In the same way, a minority, desiring to use the ship against the majority who prefer to lay her up, may obtain her. The rule was thus laid down by Justice Clifford in The Wm. Bagaley, 5 Wall. 377, heretofore cited:

Admiralty, however, in certain cases, if no ship's husband has been appointed, will interfere to prevent the majority from employing the ship against the will of the minority without first entering into a stipulation to bring back the ship or pay the value of their shares. But the dissenting owners in such a case, bear no part of the expenses of the voyage objected to, and are entitled to no part of the profits.... Unless the coöwners agree in the choice of a managing owner or the dissenting minority go into admiralty, the majority in interest control the employment of the ship and appoint the master.

The admiralty practice is governed by the old maxim that "ships were made to plow the ocean, and not to rot by the wall." So, if the owners be evenly divided in opinion, the party desiring to employ the ship will prevail, on giving security to the other. In Willings v. Blight, 2 Pet. Adm. 288; 30 Fed. Cas. No. 17765, decided by the United States District Court for the Eastern District of Pennsylvania in 1800, the court quaintly expressed the law as follows:

It is a principle discernible in all maritime codes, that every encouragement and assistance should be afforded to those who are ready to give their ships constant employment; and this not only for the particular profit of owners, but for the general interests and prosperity of commerce. If agriculture be, according to the happy allusion of the great Sully, "one of the breasts from which the State must draw its nourishment," commerce is certainly the other. The earth, parent of both, is the immediate foundation and support of the one, and ships are the moving powers, instruments and facilities of the other. Both must be rendered productive by industry and ingenuity. The interests and comforts of the community will droop and finally perish if either be permitted to remain entirely at rest. The former will less ruinously bear neglect, and throw up spontaneous products; but the latter require unremitted employment, attention and enterprise, to insure utility and product. A privation of freight, the fruit of the crop of shipping, seems therefore to be an appropriate mulct on indolent, perverse or negligent part owners. The drones ought not to share in the stores acquired and accumulated by the labor, activity, foresight and management of the bees. Although the hive may be common property, it is destructively useless to all, if not furnished with means of profit and support by industry and exertion; which should be jointly applied by all before they participate in beneficial results. Nor should the idle and incompetent be permitted to hold it vacant and useless to the injury and ruin of the industrious and active.

6. Suits between Part-Owners.—

The admiralty will sometimes entertain a suit for partition between owners who can not agree and sell the ship for the purpose of dividing the proceeds. Generally it will only recognize legal titles, that is, those shown by bills of sale or matters of record, and not merely equitable claims of ownership. Part-owners have no lien against each other where one has paid more than his share of the debts or expenses and therefore can not proceed against the ship directly. They can, however, have an accounting in equity or other proceeding in state courts for the purpose of adjusting the matter. One may sue the other for the loss of the vessel by negligence. A part-owner may have a lien upon the ship for wages or other maritime services, subordinate, however, to the liens of strangers to the title. Each is bound to pay to the others his own share of the expenses of the ship and, in the absence of an express agreement to the contrary, the law will imply a promise to repay an excess advanced by one over his share on which an ordinary action may be brought (Sheehan v. Dalrymple, 19 Mich. 239).

7. Authority of Owner.—

As between the owner and the master, the former is supreme. The relation is one of agency or employment and the master must obey. The owner has the legal right to take his ship from the custody and control of the master, at any time, and in whatever place. He may remove him at pleasure, and without assigning any cause, subject only to the ordinary responsibility for breach of contract if a contract be broken. This is because the owner is very deeply concerned in who is master of his ship and is so highly chargeable with his conduct that it is deemed proper that he should be permitted to dismiss him at any time. The relation is a confidential one and can not be forced to continue when confidence ceases.