TITLE AND TRANSFER
=1. How Title Acquired.=--Title to a ship is acquired in the same ways
as other personal property, by construction, purchase, gift or exchange.
It may pass by delivery, without any bill of sale or other written
document. This method, however, is neither advisable nor practicable
where the value is substantial or active business is contemplated.[2]
=2. Registration and Regulation.=--The United States, like other
commercial countries, provides a complete system for the registry and
regulation of all ships entitled to the privileges of American vessels.
These laws do not require registry or enrollment unless such privileges
are desired. The owner may acquire and dispose of his boat without
reference to them, but, until it is registered or enrolled, it is not a
vessel of the United States and cannot engage in any trade.
It is therefore usual to have all matters in relation to the title and
transfer of a ship in writing and according to customary forms. This is
a safe and salutary rule.
=3. Shipbuilding Contracts.=--The builder of a ship is the first owner
unless there is a special contract under which he merely performs labor
upon materials which the other party supplies. This is unusual. The
shipbuilder generally constructs the vessel upon an order or contract,
which, if properly drawn, provides for the time when the title shall
pass away from him. Such contracts should be explicit in their details,
especially as to the terms of payment and state of the title as the work
goes on. Otherwise, the title may remain in the builder until delivery;
if so, and the vessel be injured or destroyed, it will be his loss; or,
if he becomes bankrupt before delivery, the vessel may be appropriated
by his general creditors in spite of the fact that the purchase price
may have been largely paid.
In the United States _v._ Ansonia Co., 218 U. S. 452, a shipbuilder in
Richmond, Va., became insolvent while engaged in constructing three
vessels for the government; one war dredge for the War Department; one a
revenue cutter for the Treasury Department; and the third a cruiser for
the Navy. In each instance the shipbuilder was to furnish the labor and
materials and perform the work and was to receive partial payments from
time to time as the construction progressed. In the case of the dredge,
the contract provided that the parts of the vessel as its construction
progressed should become the sole property of the United States,
although it was further provided that the government might subsequently
reject defective work or parts and might even reject the completed
vessel, should it fail to pass inspection. The contracts for the revenue
cutter and cruiser, on the other hand, contained no provision for the
passing of title before completion, but did provide that the government
should have a superior lien upon the vessels for all payments made on
account. The Supreme Court (Day, J.) said:
It is undoubtedly true that the mere facts that the vessel is to be
paid for in installments as the work progresses, and to be built under
the superintendence of a government inspector, who had the power to
reject or approve the materials, will not of themselves work the
transfer of the title of a vessel to be constructed, in advance of its
completion. But it is equally well settled that if the contract is such
as to clearly express the intention of the parties that the builder
shall sell and the purchaser shall buy the ship before its completion,
and at different stages of its progress, and this purpose is expressed
in the words of the contract, it is binding and effectual in law to
pass the title.
The court further held that the lien reserved in the contracts for the
revenue cutter and cruiser was not superior to the liens of material men
under the laws of Virginia.
=4. Not Within Admiralty Jurisdiction.=--Until the vessel is launched
and completed she is not within the jurisdiction of the maritime law
but, like any other piece of construction, is subject to the local laws
of the State wherein the work is carried on. The Admiralty courts of the
United States decline jurisdiction of all contracts for the building of
a ship.
=5. Enrollment and Registration.=--When the ship is completed, she
should be registered or enrolled as an American vessel. These words are
synonymous; vessels in the foreign trade are "registered" and those in
the domestic or coastwise trade are "enrolled"; (The Mohawk, 3 Wall.
566; Huus _v._ Co., 182 U. S. 392, 395). Vessels of less than twenty
tons and more than five tons are neither registered or enrolled but
should be licensed.
=6. Ships Entitled to.=--This proceeding is accomplished at the office
of the collector of customs of the district in which the home port of
the vessel may be (Rev. St. § 4141, Morgan _v._ Parham, 16 Wall. 471).
The home port is the port at or nearest which the owner, or managing
owner, resides. The registration, enrollment and licensing of vessels is
fully covered by Regulations originally promulgated by the Secretary of
the Treasury under the navigation laws of the United States, which may
now be obtained in revised form by application to the Department of
Commerce at Washington.
Ships entitled to such registration or enrollment are:
1. Vessels built in the United States and owned by a citizen.
2. Vessels captured in war and condemned as prize, and owned by a
citizen.
3. Vessels forfeited and sold for breach of the laws of the United
States and purchased and owned by a citizen.
4. Seagoing vessels whether steam or sail which have been certified by
the Steamboat Inspection Service as safe to carry dry and perishable
cargo, _wherever built_, which are to engage only in trade with foreign
countries, being wholly owned by citizens of the United States or
corporations organized and chartered therein, the president and managing
directors and the holders of the control of which shall be citizens of
the United States; also vessels answering the foregoing description
which are to trade with the Islands of Guam and Tutuila until February
1, 1922, and thereafter as governed by Sec. 21 of the Merchant Marine
Act (see Appendix).
5. Vessels wrecked in the United States, and purchased and repaired by a
citizen, if the cost of the repairs is equal to three times the
appraised value of the wreck as salved.
6. Vessels of the United States Shipping Board sold to a citizen of the
United States.
7. Steamboats employed in a river and bay of the United States and owned
wholly or in part by an alien resident within the United States.
8. Yachts owned by citizens and employed exclusively for pleasure.
These, although foreign built, may be licensed to proceed from one
domestic port to another so long as they do not trade or carry
passengers.
=7. Incidents of Enrollment or Registration.=--The law provides that
vessels registered pursuant to law and no others (except those qualified
according to law for carrying on the coasting or fishing trade) shall be
deemed vessels of the United States and entitled to the benefits and
privileges pertaining to such vessels. When a vessel ceases to be wholly
owned by citizens of the United States or a corporation created under
the laws of the United States, control of which is held by citizens, or
ceases to be commanded by a citizen of the United States, she forfeits
her rights, benefits and privileges of a vessel of the United States.
Pilots and officers having charge of a watch must be citizens of the
United States.
A capital distinction to be borne in mind is that between vessels
entitled to engage in coastwise trade and those not so entitled. No
vessel of foreign registry may engage in that trade. No foreign-built
vessel of American registry, with certain exceptions,[3] may engage in
that trade under penalty of a fine, although it is within the power of
the Secretary of Commerce to waive the imposition of such fine, and this
has sometimes been done where an emergency arising out of exceptional
circumstances has made it necessary for an unauthorized vessel to trade
between ports of the United States. Vessels entitled to engage in the
coastwise trade are those which, being built within and owned by
citizens of the United States, are enrolled for that trade. Vessels
owned by corporations may not engage in the coasting trade unless 75 per
cent. of the interest therein is owned by citizens.
The coasting trade consists of trade between continental ports of the
United States, either directly or by way of a foreign port; that is to
say, if you depart from New York with merchandise for Miami, you are
trading between American ports, even though you may touch at Bermuda _en
route_. The test is whether you trade between ports of the United States
as part of a single voyage, irrespective of nationality of the ship. The
character of the voyage, whether foreign or domestic, is determined by
its terminus (Tabor _v._ U. S., 1 Story 1). Thus a vessel bound from New
York to Yokohama, via San Francisco, would be upon a foreign voyage.
Such a vessel, flying a foreign flag, could not discharge any of her
passengers or cargo at San Francisco.
Trade between the east and west coasts via the Panama Canal or Cape Horn
is coastwise. Trade between ports of the United States and those of
Hawaii, Porto Rico and Alaska is coasting trade, though the Shipping
Board may issue permits to foreign vessels to carry passengers between
Hawaii and the Pacific coast until February 1, 1922. Trade between ports
of the United States and those of the Philippine Islands is by statute
not coasting until February 1, 1922. Thereafter it is governed by Sec.
21 of the Merchant Marine Act, which will be found in the Appendix.
Trade between ports of the United States and those of the Panama Canal
Zone is not coasting.
By the coasting trade is not meant the mere putting in of a vessel at a
port of the United States after leaving another port for bunkers or
supplies (which is not forbidden) but trading between such ports,
_e.g._, the carriage of cargo and passengers from one such port and
their discharge at another.
=8. How Obtained.=--This registration or enrollment is obtained by proof
of the collector that the vessel was built within the United States, or
otherwise meets conditions mentioned; and that no foreigner is
interested in her (Rev. St. § 4142); her size, characteristics and other
points of identification are shown by certificates of the master
carpenter under whose direction she was built, and surveyors appointed
for the purpose, in accordance with R. S. 4147-4153; security is given
that the certificate obtained shall be solely used for the ship, and
thereupon the collector issues in statutory form his certificate of
registration or enrollment, as the case may be (Rev. St. §§ 4155, 4319).
The title to the ship may vest in one or more individuals or a
corporation. In either case the residence or domicile of the owner is
important. The law considers that for purposes of jurisdiction the ship
is a part of the territory of the state or country in which the owner
resides, and she continues for many purposes to be subject to its laws
wherever she sails (Crapo _v._ Kelly, 16 Wall. 610; The Hamilton, 207
U. S. 398).[4] In the case of Crapo _v._ Kelly, just cited, the ship
_Arctic_, registered at Fairhaven, Massachusetts, belonged to a firm of
owners, residing and doing business in that state, who had become
insolvent. The insolvent court of Massachusetts undertook to include the
vessel among the assets of the owners within its jurisdiction, for the
benefit of creditors. The vessel arrived at New York and was attached by
a creditor of the owners residing there. Upon extended consideration,
the Supreme Court held:
This vessel, the _Arctic_, was upon the high seas at the time of the
assignment (for the benefit of creditors). The status at that time
decides the question of jurisdiction.... We hold that she was subject
to the disposition made by the laws of Massachusetts and that for the
purpose and to the extent that title passed to the assignees, the
vessel remained a portion of the territory of that state.
The ship's registry or enrollment, therefore, fixes her home port and
she will be considered as belonging to the state in which such port is
located and as foreign to all other states and countries. Ordinarily she
is liable to taxation as personal property only in the state in which
her home port is situated, but this is subject to the qualification that
her situs as personal property is, for purposes of taxation, governed by
the same rules applicable to other personal effects. The general rule is
that the situs of personal property is the domicile of the owner, and a
ship will be liable to taxation in the state where the owner resides,
irrespective of the location of her home port as shown on the ship's
documents. Thus in So. Pac. Co. _v._ Ky., 222 U. S. 63, a corporation
organized in Kentucky, owned a number of vessels enrolled at New York.
They were held taxable in Kentucky.
The law further requires that every change in the title, command or
structure of the ship shall be promptly reported and placed for record
in the Collector's office, so that at any time her present status, the
name of her commander and entire past history may be fully shown upon
its books, and the Collector will furnish on request an abstract of the
title which his records disclose. This abstract, of course, becomes
important whenever the ship is sold or used as security, although it
will not show anything in regard to maritime liens upon it since these
are, in their nature, secret.
Under present practice the owners of a ship usually incorporate. Such
corporations take the complete title and are treated as the sole owner
in all respects. There is nothing in the admiralty law which
differentiates corporations from other owners. It is also popular to
incorporate as "single ship companies" and in this way a double
protection against liabilities in excess of the amount invested may be
obtained.
=9. Recording of American-built Foreign Ships.=--Vessels of foreign
ownership built in the United States may be measured and recorded in the
office of the Collector for the district in which they are built and a
certificate of record issued. The advantage of having this is in having
the official record already made in case the vessel subsequently becomes
the property of citizens and entitled to registry. Changes of name and
master of recorded vessels must be endorsed on the certificate of record
and reported to the Collector at the port of record (Rev. St.
§§ 4180-4184).
=10. Name.=--A new vessel is registered under the name selected by her
owners and must continue to bear that name--which is required to be
painted upon her bows, stern, pilot house and lifeboats in letters of
specified size,--unless permitted to change it. By Act of Congress
approved February 19, 1920, changes of name may be made by the
Commissioner of Navigation, United States Department of Commerce, "when
in his judgment there shall be sufficient cause for so doing." Before
authorizing a change of name, the Commissioner requires "such evidence
as to age, condition, where built, and pecuniary liability of the vessel
as may be deemed necessary to prevent injury to public or private
interests," including the interests of the vessel's creditors. The
purpose of these requirements is to prevent imposition upon the public
by masquerading old, worn-out vessels under new names, and to prevent
the loss of a vessel's identity, in fraud of her creditors, by changing
her name.
=11. Sale.=--The sale of a ship is usually evidenced by a bill of sale
on a government form which will be furnished by the collectors. It is
essential that it should include a copy of the last registry or
enrollment and licenses, executed in the presence of two witnesses and
acknowledged before a notary public. Mortgages may be made upon similar
forms and the statute provides that, "No sale, conveyance, or mortgage
which, at the time such sale, conveyance, or mortgage is made, includes
a vessel of the United States, or any portion thereof, as the whole or
any part of the property sold, conveyed, or mortgaged shall be valid, in
respect to such vessel, against any person other than the grantor or
mortgagor, his heir or devisee, and a person having actual notice
thereof, until such bill of sale, conveyance, or mortgage is recorded in
the office of the collector of customs of the port of documentation of
such vessel." (Ship Mortgage Act, 1920, Subsection C (a). See Appendix,
Merchant Marine Act, 1920, § 30.) While a prudent man will invariably
evidence the sale of a ship by a written instrument, this is not
essential to the validity of the sale, if the common law essentials to a
sale of personal property--delivery or payment, in whole or in part, or
both,--are present. The requirement of the statute (Rev. St. § 4170;
Ship Mortgage Act 1920, Subsection H; See Merchant Marine Act 1920,
§ 30) that a bill of sale be given, containing a copy of the registry or
enrollment, and recorded in the Collector's Office, is for the purpose
of giving notice to the world of the transfer. Without these
formalities, the sale is valid as against the grantor and persons having
actual notice only; not as against any other persons claiming an
interest in the ship. If an American vessel be sold to an alien without
obtaining the Shipping Board's approval and without recording the
transfer, the vessel is liable for forfeiture.
=12. Transfer of Flag and Sales to Foreigners.=--The Merchant Marine Act
of June 5, 1920 (see Appendix), provides that no American vessel shall
be sold or transferred to any one not a citizen or placed under foreign
registry without obtaining the approval of the Shipping Board. Any
vessel transferred in violation of this provision is subject to
forfeiture and fine. An American vessel may not be sold by order of a
district court of the United States in a suit _in rem_ in admiralty to
any person not an American citizen.
=13. Admiralty Sales.=--The title to the ship may also be transferred by
a sale in admiralty. This passes a new and complete title to the
purchaser and absolutely frees the ship from all existing liens, titles
or encumbrances. Such a sale is only made in the course of a suit in
admiralty against the ship for the enforcement of a maritime lien, or
other matter within the jurisdiction of the court. A ship which passes
through such a sale becomes in effect an absolutely new vessel so far as
prior title or encumbrances are concerned, and all previous claims are
relegated to the proceeds in the registry of the court (The Garland, 16
Fed. 283). The Ship Mortgage Act, 1920 (§ 30 Merchant Marine Act,
Subsection O), which creates preferences in favor of certain mortgages,
provides that, on the sale in admiralty of a ship upon which there has
existed a preferred mortgage the court shall, on request of an
interested party, require the purchaser at the judicial sale to give a
new mortgage on terms similar to the old one and, if such new mortgage
is given, the mortgagee shall not be paid from the proceeds of the sale
and the amount of the purchase price shall be diminished by the amount
of the new mortgage. It is essential that the court should have full and
complete jurisdiction to make the sale. Such sales are made by the
marshal under a writ issued in a pending suit in admiralty; neither the
officer nor the court warrants anything and the title given depends
wholly upon the regularity of the proceedings and the jurisdiction of
the court. The essentials are simple and it is easy to ascertain if they
have been complied with. For example, when the marshal seizes a ship
under admiralty process, he is required to give public notice of the
seizure and the return-day of the writ in order that all the world may
be bound by the proceeding. This is accomplished by taking actual
possession of the vessel, posting a copy of the writ in some conspicuous
place, and publishing an appropriate notice in some newspaper within the
district. Sometimes this publication is omitted or deferred to a later
stage of the proceedings. In Gould _v._ Jacobson, 58 Mich. 288, the
results of such an omission were fatal to the title of the purchaser at
a marshal's sale of the _Pickwick_. The ship had been seized in
admiralty and sold to pay her debts. The marshal had failed to publish
notice of the seizure; the Court held that the sale was quite void and
that replevin would lie in favor of the representatives of the original
owner against the marshal's vendee.
=14. Sales by Trustees and Executors.=--These will only transfer the
title of the true owner if the conditions of the trust or power given by
the will are strictly observed. The rules are no different than in sale
of other personal property and create no further exemption from maritime
liens or other encumbrances than sales by ordinary owners. The warranty
is usually less sweeping.
=15. Sales by Mortgagee.=--Foreclosures of vessel's mortgages are
frequently by virtue of the power of sale contained in the instrument
and, if that power is carefully observed, will convey all the title of
the mortgagor.
Until the enactment of the Ship Mortgage Act of 1920, these proceedings
were outside of admiralty jurisdiction. That act made substantial
changes, not only in the status of mortgages of American ships, but in
the manner of enforcing them. It is discussed under the title "Mortgage"
_infra_ and is printed in full in the Appendix (Merchant Marine Act
1920, § 30).
=16. Sales by Master.=--In case of actual necessity the master may sell
the ship and convey a good title to the purchaser, free of all liens.
Such sales become necessities within the meaning of the maritime law,
where the master cannot communicate with the owner and there is nothing
better that can be done for him or the others concerned in the
adventure. If the master has an honest purpose to serve those who are
interested in the ship and can clearly prove that the situation required
the sale, he will be entirely justified and the purchaser's title
secure. Good faith and necessity must concur. If, within a reasonable
time, the master can consult with the owner, he should do so, because,
if possible, the owner's judgment must control; and, in any event, the
master should not sell without the advice of competent persons on the
spot, whose opinions should be taken as to whether it is better
judgment to repair or sell. His authority does not depend on their
recommendation, but if he acts on it, his justification will be the more
secure. Where possible, the facts should be presented by a survey of the
ship and the surveyors' report give in detail the steps they take and
their conclusions, with the facts necessary to vindicate them. When a
vessel is lawfully sold by the master all existing liens are divested
and an absolute title passes. The liens attach to the proceeds, however,
which become, in the view of the maritime law, the substitute for the
ship. A good title will pass by such a sale even if no bill-of-sale is
executed. A parole sale--that is to say, a sale by word of mouth,
without bill of sale or other writing--and delivery will effectually
pass the property; while formal documents are, of course, desirable they
are not essential to its validity.
The principles governing the sale of a vessel by her master are set
forth very clearly by Mr. Justice Davis, in delivering the opinion of
the Supreme Court in the case of the _Amelie_, 6 Wall. 18: The _Amelie_
on her voyage from Surinam to Boston encountered perils of the sea, and
was obliged to seek the harbor of Port au Prince, Hayti, and was sold
there at public auction by the master, and purchased by Reviere, the
claimant. The owner of the cargo, because of its non-delivery, filed a
libel and insisted that the sale of the vessel was not justifiable and
passed no title to Reviere, the claimant; and even if the sale was
proper under the circumstances, that Reviere took title subject to all
existing liens.
The sale of a ship becomes a necessity within the meaning of the
commercial law, when nothing better can be done for the owner, or those
concerned in the adventure.... In order to justify the sale, good faith
in making it and the necessity for it must both concur, and the
purchaser to protect his title must be able to show their concurrence.
The question is not whether it is expedient to break up a voyage and
sell the ship, but whether there was a legal necessity to do it. If
this can be shown, the master is justified; otherwise not. And this
necessity is a question of fact, to be determined in each case by the
circumstances in which the master is placed, and the perils to which
the property is exposed.
If the master can within a reasonable time consult the owners, he is
required to do it, because they should have an opportunity to decide
whether in their judgment a sale is necessary.
At this point it may be observed that modern means of communication by
cable and wireless render consultation with the owner feasible in many
instances where it was not formerly possible, and there can be no doubt
that it is the master's duty to avail himself of these means before
selling the vessel. The court proceeds:
He should never sell, when in port with a disabled ship without first
calling to his aid disinterested persons of skill and experience, who
are competent to advise, after full survey of the vessel and her
injuries, whether she had better be repaired or sold. And although his
authority to sell does not depend on their recommendation, yet, if they
advise a sale, and he acts on their advice, he is in a condition to
furnish the court or jury reviewing the proceedings strong evidence in
justification of his conduct.
In this case the ship was surveyed by competent surveyors, who made a
full report and advised that the vessel be sold as the cost of repairs
would exceed her value. The court continued:
After this advice, the master who was bound to look to the interest of
all parties concerned in the venture, had no alternative but to sell.
In the face of it, had he proceeded to repair his vessel, he would have
been culpable. Being in a distant port, with a disabled vessel, seeking
a solution of the difficulties surrounding him; at a great distance
from his owners, with no direct means of communicating with them; and
having good reason to believe the copper of his vessel was displaced,
and that worms would work her destruction, what course so proper to
pursue as to obtain the advice "of that body of men who by the usage of
trade have been immemorially resorted to on such occasions?" (Gordon
_v._ Mass. Ins. Co., 2 Pick. 264). No prudent man, under the
circumstances, would have failed to follow their advice, and the state
of things, as proved in this case, imposed on the master a moral
necessity to sell his vessel and reship his cargo.
* * * * *
It is insisted, even if the circumstances were such as to justify the
sale and pass a valid title to the vendee, he, nevertheless, took the
title subject to all existing liens. If this position were sound, it
would materially affect the interests of commerce, for, as exigencies
are constantly arising, requiring the master to terminate the voyage as
hopeless, and sell the property in his charge for the highest price he
can get, would any man of common prudence buy a ship sold under such
circumstances, if he took the title encumbered with secret liens, about
which, in the great majority of cases, he could not have the
opportunity of learning anything? The ground on which the right to sell
rests is, that in case of disaster, the master, from necessity, becomes
the agent of all parties in interest and is bound to do the best for
them that he can, in the condition in which he is placed and,
therefore, has the power to dispose of the property for their benefit.
When nothing better can be done for the interests of those concerned in
the property than to sell, it is a case of necessity, and as the master
acts for all, he sells as well for the lien holder as the owner. The
very object of the sale, according to the uniform current of the
decisions, is to save something for the benefit of all concerned; and
if this is so, the proceeds of the ship, necessarily, by operation of
law, stand in place of the ship. If the ship can only be sold in case
of necessity, where the good faith of the master is unquestioned, and
if it be the purpose of the sale to save something for the parties in
interest, does not sound policy require a clean title to be given the
purchaser in order that the property may bring its full value? If the
sale is impeached, the law imposes on the purchaser the burden of
showing the necessity for it, and this he is in a position to do,
because the facts which constitute the legal necessity are within his
reach; but he cannot know, or be expected to know, in the exercise of
reasonable diligence, the nature and extent of the liens that have
attached to the vessel. Without pursuing the subject further, we are
clearly of the opinion, when the ship is lawfully sold, the purchaser
takes an absolute title divested of all liens, and that the liens are
transferred to the proceeds of the ship, which in the case of the
admiralty law becomes the substitute for the ship.
The sale in this case was made by parole; the master delivered the
vessel to the purchaser, without, so far as appeared, executing any
document evidencing the sale. On this subject, the court said:
The title of Reviere, the claimant, was questioned at the bar, because
he did not prove the master executed to him a bill of sale of the
vessel. We do not clearly see how this question is presented in the
record, for there is no proof, either way, on the subject, but if it
is, it is easily answered. A bill of sale is not necessary to transfer
the title to the vessel. After it was sold and delivered, the property
was changed and no written instrument was needed to give effect to the
title. The rule of common law on this subject has not been altered by
statute. The law of the United States which requires the register to be
inserted in the bill of sale on every transfer of a vessel, applies
only to the character and privileges of the vessel as an American ship.
It has no application to this vessel in this case.
Sales of vessels by their masters are less common now than formerly in
view of the modern facilities for communication with owners. If such
sales are subject to the restrictions of the recent acts of Congress,
heretofore mentioned, it would appear to be practically impossible for a
master to sell an American ship to a foreigner. Whether such sales,
arising as they do, _ex necessitate_, under the general principles of
maritime law, are to be regarded as outside of the provisions of these
statutes, has not been decided. There is no reason to suppose that the
requirements of the statutes are suspended in such cases.
=17. Sale of Ship at Sea.=--Such vessels may be sold or mortgaged by
delivery of a proper instrument without the actual presence of the
property and are entirely valid if possession be taken within a
reasonable time after it comes within the purchaser's reach. The new
owner should record the title in the custom house for the district in
which his residence is, and observe all the requirements of law in
regard to a new registration if he desires to preserve her national
character. To be safe, until the vessel returns, the mortgage of a ship
at sea should be recorded at the home port, as shown by the outstanding
document as well as at the new home port.
In the case of a transfer of a vessel at sea, where it is desired to
preserve her nationality, it is necessary, upon her arrival at her home
port, to deliver up her certificate of registration and obtain a new
certificate.
In the case of United States _v._ Willings, 4 Cranch, 48, a share in an
American vessel was transferred by parole while she was at sea; and,
before she reached port, was re-transferred, also by parole, to the
original owners. The government challenged her right to the American
flag, but the court held that the requirement that, upon transfer, the
certificate of registery be surrendered, did not mean that the ship
would forfeit the flag unless such surrender were contemporaneous with
the sale, since a sale may be made by parole, and, inasmuch as the ship
carries her papers with her, the registration could not be attended to
until she returned. The Court, speaking through Chief Justice Marshall,
held that the ship, having been sold at sea by parole and bought back by
her original owners, also, by parole, before she reached port, had been
twice legitimately sold and as her ownership when she returned was the
same as when she started, her nationality remained unchanged.
=18. Appurtenances.=--A bill of sale or mortgage of the ship should
describe the interest conveyed, either the whole or a fractional part,
and include the appurtenances. These are covered by the usual phrase,
"engines, boilers, machinery, masts, bowsprit, sails, boats, anchors,
cables, and all other necessaries thereunto appertaining and belonging."
Whatever is on board for the object of the voyage and belonging to the
owners will ordinarily be included, like provisions, supplies,
compasses, chronometers as well as new articles purchased for the ship
but not yet installed on board. As in other cases of sales, the
intention of the parties, so far as it can be ascertained, will control
and it is desirable to have an inventory of separate articles in order
to avoid misunderstandings or disputes.
=19. Warranties and Representations.=--The law is the same as in other
cases of sales. The buyer must take care. The seller must not deceive.
Material representations made to effect the sale are equivalent to
warranties. If the ship is built or sold for a particular purpose, there
is an implied warranty of fitness for that purpose. If the contract is
reduced to writing, the parole evidence rule will control as to prior
stipulations.
REFERENCES FOR GENERAL READING
_Shipping and Admiralty_, Parsons, Vol. I, Chapter III.
_Commentaries_, Kent, III, Lecture XLV.
_Sales_, Benjamin (2d Am. ed.), §§ 336-339.
White's Bank _v._ Smith, 7 Wall. 646.
Fleming _v._ Fire Assoc., 147 Mich. 404.
U. S. _v._ Forester, Newb. Adm. 81.
John Jay, 17 How. 399.
_Admiralty_, Benedict, § 158.
Huus _v._ S. S. Co., 182 U. S. 392.
[2] Rev. St., § 4170, is as follows:
"Whenever any vessel, which has been registered, is, in whole or in
part, sold or transferred to a citizen of the United States, or is
altered in form or burden, by being lengthened or built upon, or from
one denomination to another, by the mode or method of rigging or
fitting, the vessel shall be registered anew, by her former name,
according to the directions hereinbefore contained, otherwise she shall
cease to be deemed a vessel of the United States. The former certificate
of registry of such vessel shall be delivered up to the collector to
whom application for such new registry is made, at the time that the
same is made, to be by him transmitted to the Register of the Treasury
who shall cause the same to be canceled. In every such case of sale or
transfer there shall be some instrument of writing, in the nature of a
bill of sale, which shall recite at length, the certificate; otherwise
the vessel shall be incapable of being so registered anew."
This is discussed in § 10, _infra_, this chapter.
[3] The exceptions are foreign-built vessels purchased from the United
States Shipping Board and foreign-built wrecks repaired in the United
States as indicated in § 6, _supra_, this chapter. Also all
foreign-built vessels admitted to American Registry, owned on February
1, 1920, by citizens so long as they continue to be so owned.
[4] While a vessel is part of the territory of her home jurisdiction for
jurisdictional purposes, the doctrine of her territoriality does not
extend to treating her as part of the soil for all purposes. Thus the
Supreme Court has held that foreign seamen brought to the United States
to work on an American ship engaged in foreign commerce, were not
engaged "to perform labor within the United States" within the meaning
of the contract labor law. (Scharrenberg v. Dollar S. S. Co., 245 U. S.
122.)