The owner of a vessel is liable for injuries done to third persons or property by the negligence or malfeasance of the master and crew while in the discharge of their duties and acting within the scope of their authority. It is upon this principle that the defendants are liable, if at all, to the libellants for the damages sustained. The circumstance that the agents were in the employment of the owners on board the vessel, and that the negligence occurred while so employed, and which occasioned the damage, gives to the libellants the right of action.
This is, indeed, simply the general law of master and servant or principal and agent.
10. Temporary Ownership.—
The ship may be chartered so that the hirer will become, in law, her temporary owner. This is ordinarily accomplished by means of a written contract called a charter party. It may contain whatever agreements the parties choose but when its legal effect is to give the hirer exclusive possession, control and management, so that he appoints the master, runs the vessel and receives the entire profits, there is a demise or conveyance of the ship and the hirer becomes owner pro hac vice, or, for the time being. He is then responsible for her contracts and torts and may limit his liability as if he were the actual owner and the latter is freed from personal responsibility. The situation is like a lease of premises on land to a tenant. The officers and crew become the agents or employees of the charterer and, in matters of contract particularly, as for supplies and repairs, the ship may not be subject to maritime liens if the creditor has notice of the terms of the charter party which preclude their creation. To effect this change into temporary ownership, the terms of the instrument should be plain and explicit; if indefinite or ambiguous, the construction will be against a demise of the ship, the courts favoring an interpretation which preserves the liabilities and liens incident to the permanent title.
The temporary ownership of a vessel by a person other than the real owner does not relieve the ship herself from those liabilities which attach to her in any event: For example, her liability for damage caused others by her torts, as faulty navigation; or from liability under those contracts for which the ship itself is primarily responsible, such as contracts for bunkers and supplies and necessary repairs elsewhere than in the home port. This principle is laid down in the case of the Barnstable, 181 U. S. 464, as follows:
The law in this country is entirely well settled that the ship itself is to be treated in some sense as the principal and as personally liable for the negligence of any one who is lawfully in possession of her whether as owner or charterer.
And in the case of Sherlock v. Alling, 93 U. S. 99, where it was said:
By the maritime law the vessel, as well as owners, is liable to the party injured for damages caused by its torts. By that law the vessel is deemed to be an offending thing and may be prosecuted without any reference to the adjustment of responsibility between the owners and the employees for the negligence which resulted in the injury.
The claim of the true owner to his vessel will not, however, be defeated by fraudulent acts of the temporary owner to which the real owner was not privy, because in such a case the theory of the agency of the master or temporary owner for the real owner fails. This subject is discussed in the leading case of the Freeman, 18 How. 182. In that case the temporary owner caused the master to sign bills of lading, certifying that a quantity of flour had been shipped on board the schooner from Cleveland to Buffalo by the temporary owner consigned to the libellants. No such flour had in fact been shipped and the consignees, who had advanced money on the bills of lading, libeled the ship. The real owner filed a claim to the vessel. The Court (Curtis, J.) said:
Bills of lading themselves are not real contracts of affreightment, but only false pretenses of such contracts; and the question is, whether they can operate, under the maritime law, to create a lien, binding the interest of the claimant in the vessel.