=Provisions Scale.=--Since 1790 the laws of the United States have

specified a scale of provisions required to be carried upon vessels.

With minor alterations included in the Seamen's Act, the present scale,

with permissible substitutions, was fixed by law on December 21, 1898.

Under this law seamen have the option of accepting the provisions

offered or of demanding the legal scale, which is required to be

inserted in all ship articles and to be posted in the galley and

forecastle. The laws contain provisos for complaints to be made to the

officer in command of the vessel or to the United States consular

officer or Shipping Commissioner or chief officer of the customs, who

has authority to take action to see that the deficiency is corrected,

subject to a penalty for default.

For allowing the supply of provisions to be reduced below the legal

scale during the voyage, except for unavoidable causes, compensation

must be paid to every seaman according to the time of its continuance

and in accordance with the scheduled allowances fixed by law.

=Hospital Accommodations.=--In addition to crew space already referred

to all merchant vessels which ordinarily make voyages of more than three

days' duration and carry a crew of twelve or more seamen, are required

to have a separate compartment for hospital purposes with at least one

bunk for every twelve seamen, provided that not more than six bunks in

all may be required.

=Warm Room and Woolen Clothing.=--Every vessel bound on a voyage over

fourteen days in length must, in addition to a slop chest, provide for

each seaman one suit of woolen clothing, as also a "safe and warm room"

for cold weather.

XIII. PERSONAL INJURIES TO SEAMEN AND RECOVERIES FOR DEATH

Prior to the passage of the recent Merchant Marine Act (1920) recovery

by a seaman for injuries received by him in the service of the ship was

subject to the maritime law under which (except in case of the

unseaworthiness of the vessel, where full recovery might be claimed) the

seaman was entitled to, but only to, his maintenance and cure, and to

wages so long at least as the voyage continued, regardless of his own

negligence (unless it amounted to willful misconduct) or of that of any

other person. Where his contract extended beyond the voyage or there was

fault on the part of the ship, recovery of wages was allowable even

beyond the termination of the voyage.

This liability could not be enlarged or diminished by any law of the

states on the subject of employer's liability or workmen's compensation.

The Seamen's Act of 1915 undertook to enlarge the protection of seamen

by providing that in suits to recover damages for injuries received on

board a vessel, or in its service, seamen "having command," _e.g._,

masters, etc., should not be held to be fellow servants with those under

their authority, but this was held not to affect those cases covered by

the general rule of the maritime law above stated, under which the

fellow servant question is immaterial.

A more successful effort at extending the seaman's right, however, was

made in the recent Merchant Marine Act, which permits any seaman who

suffers injury in the course of his employment, to maintain, at his

election, an action for damages at law, with the right of trial by jury,

and in such case to have the benefit of the United States statutes

modifying or extending the rights of railroad employees in analogous

cases.

The same act also covers the question of actions for the death of

seamen, giving to their personal representatives the right to sue for

damages at law and the benefit of a trial by jury, and the similar

benefit of the laws covering actions for death in the case of railroad

employees.

This provision, it is observed, is in sharp contrast, and perhaps in

some conflict with the provision of an act passed at the same session of

Congress, on March 30, 1920, giving a general right to maintain actions

for all deaths occurring on the high seas by some wrongful act or

neglect. This law, which in its broad terms covers also the case of

seamen, permits suits to be brought in the admiralty courts and fixes

the recovery at the amount of pecuniary loss sustained by the persons

for whose benefit suit is brought. It further provides that in such

action the fact that the decedent has been guilty of contributory

negligence is not to be considered a bar to recovery, but is to be taken

into consideration by the court in fixing the degree of negligence and

in reducing the recovery accordingly.

A discussion of the technical questions involved in the relations of

these two acts is beyond the scope of this summary.

XIV. OFFENSES BY SEAMEN

Offenses by seamen are punishable under the laws of the United States,

generally, when committed on the high seas, or on any waters within the

jurisdiction of the admiralty courts, or on lands under the exclusive

jurisdiction of the United States. The list of crimes covers those

familiar to the criminal law, such as murder, manslaughter, assault,

rape, robbery, arson, larceny, forgery, receiving stolen property, etc.

Other offenses peculiar to marine life may be noted as follows.

=Mutiny, Desertion and Disobedience.=--Inciting to or participation in a

mutiny on a United States vessel is punished by a fine of not over

$1,000 or imprisonment of not over five years or both. This offense

includes the stirring up of the crew to resist lawful orders or "to

refuse or neglect their proper duty, or to betray their proper trust,"

also "the assembly with others in a tumultuous and mutinous manner." The

actual revolt or mutiny--the usurping of the command of a vessel, is

punishable by a fine of not over $2,000 or imprisonment of not over ten

years, or both.

Willful disobedience is punishable under the Seamen's Act by being

placed in irons until the disobedience ceases, and, on arrival in port,

by forfeiture of wages, not exceeding four days' pay, or, at the

discretion of the court, by imprisonment not exceeding a month.

Continued willful disobedience subjects the offender to being placed in

irons on bread and water, with full rations every fifth day, until the

disobedience ceases, and the forfeiture, on arrival in port, of twelve

days' pay for every twenty-four hours' disobedience, or by imprisonment

not over three months, at the discretion of the court.

Desertion is punishable under the Seamen's Act by forfeiture of clothes

and effects left on the vessel, and of wages due, the former penalty of

imprisonment for desertion in a foreign port having been abolished, as

also the provision for the arrest of seamen deserting from foreign

vessels. This proviso is much more lenient than the laws of most foreign

countries. In the case of England, if the desertion takes place outside

the United Kingdom the deserter is liable to imprisonment for a period

not exceeding twelve weeks. Imprisonment for desertion in the coastwise

trade was abolished by the Maguire Act in 1895.

=Miscellaneous Offenses.=--Among these may be mentioned the following:

_Seduction_ of a female passenger, by master, officer, crew or employee

is punishable by a fine not exceeding $1,000 and imprisonment not

exceeding one year, or both. A subsequent marriage may be pleaded in bar

of conviction. _Misconduct_, neglect or inattention to duty, resulting

in loss of life, is punishable by fine not exceeding $10,000, or

imprisonment not more than ten years, or both. _Abandonment of seamen_

is punishable by a fine not over $500, or imprisonment not over six

months, or both. _Barratry_--the attempt to injure or destroy a vessel

for her insurance--is punishable by a fine not over $10,000 and

imprisonment not over ten years. _Wrecking_--plundering or stealing from

a wrecked vessel--calls for a fine not exceeding $5,000 and imprisonment

not exceeding ten years. _Willfully Obstructing Escape_ from a wrecked

vessel subjects the offender to a minimum imprisonment of ten years,

with a maximum punishment of imprisonment for life. _Plundering_ a

vessel,--fine $5,000 maximum, and imprisonment not exceeding ten years.

_Entering_ a vessel with intent to commit felony,--fine $10,000 maximum,

and imprisonment not exceeding five years. _Casting away_ or otherwise

destroying vessel by owner,--imprisonment for life or any lesser term;

by other person, imprisonment not exceeding ten years.

The carrying of sheath-knives by seamen in the merchant service is

forbidden, and penalties for allowing violation of this prohibition are

imposed upon the master.

Officers, seamen and employees are forbidden to visit passengers'

quarters except by permission of the master. Severe penalties are

imposed upon both the offending person and upon the master permitting

the violation.

Corporal punishment is prohibited by the Seamen's Act under penalties

not only of fine and imprisonment, but of liability to civil damages.

Ill treatment of a seaman, beating without justifiable cause, wounding

or beating, or the withholding of suitable food and nourishment, or the

infliction of any cruel and unusual punishment is punished by fine of

not over $1,000 or imprisonment of not over five years.

Shanghaiing was prohibited, under severe penalties, in 1909.

=Assistance in Case of Collision.=--The law requires every master, in

the case of a collision, so far as he can do so without serious danger

to his own vessel or its crew or passengers, to stand by the other

vessel until he has ascertained that she has no need of further

assistance, and to render such assistance as may be practical, also to

give the name of his own vessel, her port of registry, and other

material information. For failure to do so and in the absence of

reasonable cause shown for such failure, a collision, in the absence of

proof to the contrary, is deemed to have been caused by such master's

wrongful act or neglect.

For failing to render such assistance, or giving the information

required, masters are liable to a fine of $1,000 or a year's

imprisonment, and the vessel is expressly made liable for the amount

named, one-half of which is payable to the informer.

XV. RULES OF THE ROAD

There are three general bodies of rules covering the navigation of

vessels with respect to the rules of the road.

The first of these are the International Rules which were adopted at a

conference of maritime nations held in the United States in 1889, which

are now in force in practically all maritime countries. They apply only

to vessels on the high seas, the boundary line of which, so far as the

United States is concerned, has been defined by an act of Congress

passed in 1913, under which the Secretary of Commerce, having been

authorized to fix lines separating the high seas from inland waters for

the purposes of the rules of the road, has defined a water line from

Cutler Harbor, Maine, to Puget Sound.

The second body of rules is known as the Inland Rules, embodied in a

federal statute passed in 1897, and applicable only to the waters within

the line thus defined. These rules, generally speaking, are similar to

the International Rules but differ in a number of details.

The third body of rules is what is known as the Pilot Rules for certain

inland waters of the Atlantic and Pacific coasts and of the coast of the

Gulf of Mexico, adopted by the supervising inspectors of the Steamboat

Inspection Service, approved by the Secretary of Commerce under

authority of the Act of June, 1897, establishing the Inland Rules, and

of subsequent acts passed in 1903 and 1913, establishing the Department

of Commerce. These rules are also to a large extent similar to, and are

generally in harmony with the inland rules, to which they yield in case

of conflict. More extended reference to these rules, the knowledge of

which should be a matter of second nature to seafaring men, is beyond

the scope of this summary.

XVI. PILOTAGE

As the states had enacted pilotage laws before the adoption of the

Constitution, the right of the states to a certain measure of control

over pilotage, within their boundaries, has always been recognized, and

consequently a dual system has grown up. The state laws are effective

except where the subject is specifically covered by a federal law.

As to the federal requirements, all vessels engaged in the _coasting_

trade are required, when under way and within the jurisdiction of the

United States, that is, except on the high seas, to be piloted by

officers duly licensed under the federal law as pilots for the

particular waters covered. This is covered by the qualifications laid

down for the various classes of vessels by the Board of Supervising

Inspectors, and by the provision of our law that the qualifications

necessary for obtaining a license as master, mate or pilot of all steam

vessels shall be as prescribed by the Board.

Registered steam vessels, when engaged in _foreign_ trade, and all

sailing vessels of the United States in the foreign or coasting trade,

are exempt from this requirement, but are subject to the requirements of

the pilotage laws of the several states.

The master of a foreign vessel is not required to employ a pilot

licensed under the laws of the United States.

As to state laws, the pilotage of all vessels in state waters (except

enrolled steam vessels employed in the coasting trade, which are

exempted from state supervision by act of Congress), is regulated by the

laws of the respective states. There are, however, a number of special

prohibitions designed to prevent controversy between the states. Thus,

no regulation may be adopted by one state making the discrimination of a

lower pilotage as to vessels sailing between ports of one state and

vessels sailing between ports of different states, nor any

discrimination against steam vessels; nor may a state require pilots to

procure a state license in addition to that issued by the United States.

It is to be noted that the federal law, which forbids the states to

require enrolled coastwise steamers to take on state pilots, does not

apply to _sailing vessels_ even though they may be in a tow of a steam

tug carrying a licensed pilot, a discrimination difficult to justify.

In this connection, thrifty ship agents handling _registered_ vessels

which for the time being happen to be engaged in the _coasting_ trade,

will naturally see to it that registers are exchanged for enrollments,

wherever a substantial saving in the matter of exemption from state

pilotage fees can be figured out.

It is to be noted, however, that in order to permit this very saving, in

another direction, the government permits vessels engaged in trade

through the canal to be enrolled and licensed. By thus obviating the

necessity for registry, state pilotage is avoided.

XVII. LENGTH OF HAWSERS

The law provides a special procedure covering length of hawsers in the

case of tows. The Commissioner of Lighthouses, the Supervising Inspector

of the Steamboat Inspection Service, and the Commissioner of Navigation

are directed to convene as a board, under directions of the Secretary of

Commerce, and to prepare regulations limiting the length of hawsers

between towing vessels and seagoing barges in tow, and the length of

such tows within any of the inland waters of the United States. Willful

violation of these regulations subjects the license of the master of the

towing vessel to suspension or revocation.

XVIII. INSPECTION OF STEAM VESSELS

All steam vessels must be inspected yearly as to their hulls, and

generally as to whether they have complied with all the requirements of

the law in regard to fires, boats, pumps, hose, life preservers, floats,

anchors, etc., as laid down in the Rules and Regulations of the United

States Board of Supervising Inspectors, which should be familiar to all

masters. Inspectors, however, have the widest latitude. The law requires

that they shall satisfy themselves that the boat is in a condition to

warrant their belief that she may be used in navigation with safety for

life. In making this test they may have her put under way or may adopt

any other suitable means to test her sufficiency or that of her

equipment. This yearly inspection, however, may be suspended under

special regulations, when vessels are laid up and dismantled and out of

commission. In this connection it is perhaps worth remembering that the

laws of the United States make it a criminal offense for any person

knowingly to send to sea an American ship, whether in the coast, foreign

or coastwise trade, in such an unseaworthy state that the life of any

person is liable to be endangered. The punishment for this offense is

properly severe--imprisonment not exceeding five years or a fine not

exceeding $1,000 or both at the discretion of the court.

The law also provides for the yearly inspection of the boilers of all

steam vessels, including tug-boats, to insure compliance with the

requirements of the standards issued by the board.

=Barges.=--Seagoing barges of over 100 tons gross are also subject to

yearly inspection. The standard applied by the local inspectors is the

elastic one that they shall satisfy themselves that the barge is "of a

structure suitable for the service in which she is to be employed, has

suitable accommodations for the crew, and is in a condition to warrant

the belief that she may be used in navigation with safety to life." In

the case of such barges the law also specially provides that there shall

be at least one lifeboat, one anchor with suitable chain or cable, and

at least one life preserver for each person on board.

Without such certificate of inspection actually in force at the time, no

document can be issued for a barge, and for navigating a barge without a

certificate or without the equipment referred to the owner is liable to

a penalty of $500. Certificates of inspection for barges are issued in

the same manner as for seagoing vessels generally. Where the certificate

is not available at the time of securing a new document, evidence that

it is still in force must be produced to the Collector, which may be in

the form of a telegraphic confirmation of the fact, from the office of

the Steamboat Inspection Bureau, Department of Commerce, Washington.

=The Certificate of Inspection.=--Upon the making of every inspection,

if the inspectors refuse to grant a certificate, they are required to

sign a written statement of their reasons for their disapproval. If

approval is granted, however, it is their duty to immediately deliver to

the master or owner a temporary certificate, which is good until the

regular certificate has been delivered. Copies of these certificates are

kept on file in the inspector's office or in the office of the Collector

of Customs. The original is required to be posted in a conspicuous place

in the vessel, to be kept there at all times except where it is

otherwise permitted in special cases under the regulations.

=Manning of Inspected Vessels.=--The inspection of the local inspectors

covers not only the hull and boiler and equipment, but also the

questions of manning, character of merchandise to be carried, and the

mode of packing dangerous articles, etc.

The local inspectors, on making the general inspection of the vessel,

are required to make entry in the certificate of inspection of such

complement of licensed officers and crew, including certificated

lifeboat men, as they consider necessary for her safety, this entry

being subject to right of appeal to the Supervising Inspector General.

Where such a vessel is for any reason deprived of the services of any

number of the crew, without the consent or fault of the master or any

person interested in the vessel, she is permitted to proceed on her

voyage if, in the judgment of the master, she is still sufficiently

manned. It is required, however, that the master shall ship, if

obtainable, a number equal to those whose services he has been deprived

of, and of the same or higher grade, also that he shall explain in

writing the situation to the local inspectors within twelve hours of the

arrival of the vessel at its destination under penalty of $50. The

penalty for undermanning the vessel is $100, or in case of an

insufficient number of licensed officers $500.

XIX. REGISTER TONNAGE

Three methods of measuring the capacity of a ship are more or less in

general use in the maritime world.

The displacement tonnage, or weight of the volume of water displaced by

the ship when fully loaded with all her crew, coal, supplies, etc., is

in general use by the navies of the world for assuring accuracy and

uniformity, but of course is not adapted to merchant vessels on which

the cargo varies from voyage to voyage.

The deadweight tonnage, or actual weight of the cargo which a merchant

ship will transport, obviously is adaptable only for vessels carrying

bulk cargoes and not for general cargo ships. Each of these measurements

is recorded in long tons avoirdupois.

The American registered tonnage system follows the Moorsom rules adopted

in England in 1854, which are now in effect in practically every

maritime country. It aims to express the entire cubical content of a

merchant ship in unit tons of 100 cubic feet, this figure having been

arrived at in England, on the adoption of the present system, when it

was found that the ratio of the total registered tonnage of the British

merchant marine to cubic feet of contents was slightly over 98.

The measurement rules of the United States are carefully and elaborately

defined in the statutes themselves.

Under the statutes net tonnage is ascertained by deducting from gross

tonnage that proportion of the ship's space occupied by engine's

machinery, boilers, coal bunkers and certain other minor spaces, such as

those which inclose the steering gear below deck, the boatman's stores,

chart-houses, donkey engine and sail room.

To encourage the building of ample forecastles, crews' quarters, etc.,

as well as for other reasons, the rule is adopted by almost all maritime

nations that tonnage taxes and other tonnage dues shall be collected not

on gross but upon the net tonnage. This also includes the usual

commercial charges for towage, dockage and wharfage. Official U. S.

statistics of entrances and clearances are in terms of net-register

tonnage, as also time charter rates when not specifically based on

deadweight tonnage. The incentive to understate net register is thus

strong.

In the case of tugs engaged in foreign service and which are therefore

subject to tonnage duties, it becomes important to see that the net

tonnage, which should ordinarily be a very small figure, is held to the

lowest limit. For instance, seagoing and oceangoing tugs have been

reported with a tonnage as low as eight and ten tons. On the other hand,

many American tugs of no larger capacity are in the habit of carrying a

net tonnage far exceeding this amount.

XX. TONNAGE TAXES

Tonnage tax is levied on every vessel engaged in trade upon her arrival

by sea from a foreign port unless she is in distress. It is not levied

on more than five entries at the same rate during any one year nor on

vessels arriving otherwise than by sea from foreign ports at which

equivalent taxes or dues are not imposed on vessels of the United States.

This tax varies from two to six cents per net ton, the two cent rate

applying to ports in North and Central America, the West Indies,

including Cuba and the Bermuda Islands, the coast of South America

bordering on the Caribbean Sea, and New Foundland. By special treaty

arrangement it also applies to Norway and Sweden. The six cent rate

applies to all other trade.

Vessels entering otherwise than by sea from a foreign port at which

tonnage or lighthouse dues or other equivalent tax or taxes are not

imposed on vessels of the United States, are exempt from the tonnage

duty of two cents per ton, not to exceed in the aggregate ten cents per

ton in any one year.

These tonnage duties are substantially similar to the corresponding

English rates, but are materially lower than corresponding charges in

European continental ports. There are a number of special instances of

exceptional cases, but which are not of sufficient frequency or

importance to deserve special mention. It is well to remember, however,

that if any officer of an American vessel should happen not to be a

citizen a penalty of fifty cents a ton is imposed, except as provided by

presidential proclamation in the case of certain vessels of foreign

origin.

Foreign steam tugs employed in towing coastwise vessels are liable to a

tonnage of fifty cents a ton on the measurement of the vessel towed,

unless the towing is done in whole, or in part, within or upon foreign

waters, or when the tug-boat is owned by a foreign railway company whose

cars enter into the United States by means of such transportation.

XXI. NAVIGATION FEES

Vessels engaged in foreign trade with other than Canadian ports are

subject to navigation fees upon entry. Thus if she is less than 100 tons

burden the fee is $1.50. Over that amount the fee is $2.50. Her

clearance fee is at the same rate.

In the event that she might have any dutiable merchandise on board she

would also be liable under similar conditions to the usual fees for

surveyor's services in connection with her customs entries, to wit,

$1.50, if less than 100 tons, and $3 if more than 100 tons. Where she

carries no dutiable merchandise, however, the fee is a nominal one of

sixty-seven cents, which applies, of course, in the case of foreign

ballast which is not dutiable.

XXII. ANNUAL LIST OF MERCHANT VESSELS

The law provides that the Commissioner of Navigation shall publish

annually a list of vessels of the United States belonging to the

commercial marine, specifying their official number, signal letters,

name, rig, tonnage, home port, and place and date of build,

distinguishing sailing vessels from those propelled by steam or other

motive power. The list for the year 1919 was the fifty-first list so

published.

Under the provisions of an act passed in 1912 it is required that upon

affidavit by a reputable ship builder as to the rebuilding of _unrigged_

wooden vessels, giving date and place of their rebuilding, and

certifying that they are sound and free from rotten wood and in every

respect seaworthy, a notation to this effect shall be included in the

list. It is noted that the provision applies only to _unrigged_ wooden

vessels, and thus does not cover the case of rigged barges, whatever

their size.

XXIII. NUMBERING OF UNDOCUMENTED MOTOR BOATS

In 1918 a law was passed requiring the numbering of all theretofore

undocumented motor boats, except vessels under sixteen feet temporarily

equipped with detachable motors. These numbers are awarded by the

collectors of customs on application of the owner or master, and are

required to be painted, or otherwise attached, to the bow of the vessel,

and to be not less than three inches in size. Violation of the act is

subject to a penalty of $10.

From the date of the passage of the act on December 7, 1917, up to July

1, 1919, nearly 100,000 such vessels had been numbered, and the

experiment had proved highly successful in assisting the enforcement of

the navigation laws and the collection of taxes as well as the

enforcement of harbor police laws and regulations.

XXIV. ADMINISTRATION OF NAVIGATION LAWS

Practically every department of the government has to do with some

feature or other of the navigation laws as affecting ship building,

maritime commerce and ocean transportation. Primarily, however, the

administration of the laws is in the hands of the Department of

Commerce, under the immediate direction of the Bureau of Navigation, the

Steamboat Inspection Service and the United States Shipping

Commissioners. Other branches of government service whose functions

touch on some phase of navigation are the Public Health Service, with

its hospitals and quarantine stations, and the Coast Guard which, since

1915, has included the Revenue Cutter and Life Saving Service. The War

and Navy departments also have various functions related primarily to

the national defense. The activities of the Shipping Board will be

separately reviewed.

=Commissioner of Navigation.=--The Bureau of Navigation, under the head

of the Commissioner of Navigation, has general superintendence of the

merchant marine and seamen so far as they are not directly subject to

other departments; it controls the documentation of vessels and has

supervision of the laws relating to measurement of vessels, signal

numbers and the questions relating to the tonnage tax. It is charged

further with the preparation of the annual list of vessels belonging to

the merchant marine, has authority to change the names of vessels, and

is charged with the preparation of annual reports to the Secretary, and

with numerous other miscellaneous but important duties.

=Steamboat Inspection Service.=--The Steamboat Inspection Service is

under the direction of a Supervising Inspector General appointed by the

President, in addition to which there are ten supervising inspectors who

meet as a Board in Washington at least once a year and establish

regulations necessary to carry out the inspection laws relating to

vessels, subject to the right of the Secretary of Commerce to convene a

special executive committee, composed of the Supervising Inspector

General and two supervising inspectors, who have power to alter and

amend these rules with the approval of the secretary.

The principal duty of the supervising inspectors is to supervise the

work of a large number of local inspectors of hulls and of boilers, and

who in their respective districts, upon designation of the Secretary of

Commerce, constitute the Board of Local Inspectors charged with the

duties of inspection and the issuance and supervision of licenses

already referred to.

=Shipping Commissioners.=--The Shipping Commissioners of the United

States form a highly responsible body of officers with semi-judicial

functions, who are directly responsible to the Secretary of Commerce, by

whom they are appointed. The law provides one such officer for each port

of entry which is a port of ocean navigation, and which in the judgment

of the Secretary shall require the services of a Commissioner, and for

whom Congress has made an appropriation. Generally speaking, the duties

of the Shipping Commissioner are to afford facilities for engaging

seamen; to superintend their engagement and discharge in the manner

prescribed by law; to provide means for securing their presence on the

board at the proper time; to facilitate the making of apprentices in the

sea service; and to perform other duties imposed upon them.

One of the most important and useful functions of a Shipping

Commissioner, particularly when the office is in capable hands, is that

of arbitrating claims between master, consignee, agent or owner or any

of the crew, when both parties agree in writing to submit to the award,

it being provided by law that an award made by a Commissioner in such

case is binding on both parties and in any legal proceedings is to be

deemed conclusive of the rights of the party.

The Commissioners are given authority to call upon owners, agents,

masters, for proof or production of books, papers, etc., or to give

evidence before the Commissioner subject to a penalty and punishment for

contempt for failure to so comply.

As it is the practice to insert arbitration clauses in all steamers'

shipping articles, excepting those operated by the Shipping Board, which

should be carefully read to the crews before they are signed, this duty

is generally viewed by captains and owners as an invaluable aid to

shipping and has been accepted also by the majority of seamen. The work

of the Commissioners in this direction has been so successful that an

effort was recently made to confer upon the Commissioners by law certain

magisterial powers subject to appeal to the United States District

Courts. So far the effort has been unsuccessful.

Having in mind their responsibilities and enormous possibilities of

service to navigation, Shipping Commissioners are among the most

pitifully underpaid of government officials. As an illustration of this

it may be noted that the Commissioners in the great ports of

Philadelphia and of Norfolk receive salaries of $2,400 and of $1,800,

respectively.

XXV. THE SHIPPING BOARD

The United States Shipping Board was created before the war, by the

Shipping Act of 1916, with the dual function and purpose, first of

acting as the administrative agent of the government in developing the

merchant marine and the naval auxiliary in peace time, and, second, that

of meeting the shipping problems incident to a possible war.

Its most important powers have heretofore been exercised through the

instrumentality of the United States Shipping Board Emergency Fleet

Corporation, organized by, and the stock of which has been held by, the

Shipping Board, for the Government. The primary function of the

Corporation was the construction of vessels, but its work was soon

extended to include their operation, in an effort to avoid the

embarrassments, prior to our entering the war, of having our vessels, if

operated by such purely public administrative agency as the Shipping

Board, treated as public vessels in foreign ports. In the beginning it

was intended that the Corporation should function in the character of a

private corporation, and 50,000,000 dollars was appropriated to it for

the construction of vessels, but during the war it acted primarily as

the agent of the President, claiming the immunities and privileges

incident to that somewhat anomalous relation, and has expended upwards

of 3,000,000,000 dollars, its capital remaining intact. The actual

operation of vessels by the Corporation has been carried out through the

instrumentality of a specially organized Division of Operations, which

was largely separate from the Corporation itself, and subject to the

direction and supervision of the Shipping Board.

The jurisdiction of the Shipping Board, however, has not been confined

to vessels in which the government is interested as owner or charterer.

From the first the Board has had authority to enforce a general

prohibition against unfair discrimination and preferences and against

the improper influencing of marine insurance companies by common

carriers by water, whether in foreign or interstate commerce, not

including tramps, and has also exercised the right of supervising and

regulating tariffs fixed by common carriers in _interstate_ commerce. In

this field, however, the jurisdiction of the Board does not overlap the

jurisdiction of the Interstate Commerce Commission, which has authority

to establish through routes and joint rates where they involve water

transportation. Like the Interstate Commerce Commission the orders of

the Shipping Board are subject to review by the federal courts.

A recent provision of the Merchant Marine Act (1920) reorganizes and

strengthens the Shipping Board, consolidating and centralizing its

control and giving it wide powers in the matter of developing the

American merchant marine and of encouraging the establishment of new

lines and the investigation generally of all matters relative to the

advancement of merchant marine.

Among other new powers of general scope given to the Board is that under

which it is authorized to make rules and regulations affecting shipping

in the _foreign_ trade, wherever necessary, in order to meet special

conditions in foreign trade arising out of foreign laws or competitive

methods practiced in foreign countries. The Board is also authorized to

request the heads of departments to suspend and modify regulations or to

make new regulations affecting shipping in the foreign trade, except

those relating to the Public Health Service, the Consular Service and

the Steamboat Inspection Service, and no rules or regulations excepting

those affecting the services named, may be established by any department

without being first submitted to the Board for its approval and final

action taken thereon by the Board or the President.

[33] Of the Philadelphia Bar.

APPENDIX II

THE MERCHANT MARINE ACT OF 1920[34]

_Be it enacted by the Senate and House of Representatives of the United

States of America in Congress assembled_, That it is necessary for the

national defense and for the proper growth of its foreign and domestic

commerce that the United States shall have a merchant marine of the best

equipped and most suitable types of vessels sufficient to carry the

greater portion of its commerce and serve as a naval or military

auxiliary in time of war or national emergency, ultimately to be owned

and operated privately by the citizens of the United States; and it is

hereby declared to be the policy of the United States to do whatever may

be necessary to develop and encourage the maintenance of such a merchant

marine, and, in so far as may not be inconsistent with the express

provisions of this Act, the United States Shipping Board shall, in the

disposition of vessels and shipping property as hereinafter provided, in

the making of rules and regulations, and in the administration of the

shipping laws keep always in view this purpose and object as the primary

end to be attained.

SEC. 2. (a) That the following Acts and parts of Acts are hereby

repealed, subject to the limitations and exceptions hereinafter, in this

Act, provided:

(1) The emergency shipping fund provisions of the Act entitled "An Act

making appropriations to supply urgent deficiencies in appropriations

for the Military and Naval Establishments on account of war expenses for

the fiscal year ending June 30, 1917, and for other purposes," approved

June 15, 1917, as amended by the Act entitled "An Act to amend the

emergency shipping fund provisions of the Urgent Deficiency

Appropriation Act, approved June 15, 1917, so as to empower the

President and his designated agents to take over certain transportation

systems for the transportation of shipyard and plant employees, and for

other purposes," approved April 22, 1918, and as further amended by the

Act entitled "An Act making appropriation to supply deficiencies in

appropriations for the fiscal year ending June 30, 1919, and prior

fiscal years, on account of war expenses, and for other purposes,"

approved November 4, 1918;

(2) Section 3 of such Act of April 22, 1918;

(3) The paragraphs numbered 2 and 3 under the heading "Emergency

shipping fund" in such Act of November 4, 1918; and

(4) The Act entitled "An Act to confer on the President power to

prescribe charter rates and freight rates and to requisition vessels,

and for other purposes," approved July 18, 1918.

(5) Sections 5, 7, and 8, Shipping Act, 1916.

(b) The repeal of such Acts or parts of Acts is subject to the following

limitations:

(1) All contracts or agreements lawfully entered into before the passage

of this Act under any such Act or part of Act shall be assumed and

carried out by the United States Shipping Board, hereinafter called "the

board."

(2) All rights, interests, or remedies accruing or to accrue as a result

of any such contract or agreement or of any action taken in pursuance of

any such Act or parts of Acts shall be in all respects as valid, and may

be exercised and enforced in like manner, subject to the provisions of

subdivision (c) of this section, as if this Act had not been passed.

(3) The repeal shall not have the effect of extinguishing any penalty

incurred under such Acts or parts of Acts, but such Acts or parts of

Acts shall remain in force for the purpose of sustaining a prosecution

for enforcement of the penalty therein provided for the violation

thereof.

(4) The board shall have full power and authority to complete or

conclude any construction work begun in accordance with the provisions

of such Acts or parts of Acts if, in the opinion of the board, the

completion or conclusion thereof is for the best interests of the United

States.

(c) As soon as practicable after the passage of this Act the board shall

adjust, settle, and liquidate all matters arising out of or incident to

the exercise by or through the President of any of the powers or duties

conferred or imposed upon the President by any such Act or parts of

Acts; and for this purpose the board, instead of the President, shall

have and exercise any of such powers and duties relating to the

determination and payment of just compensation: _Provided_, That any

person dissatisfied with any decision of the board shall have the same

right to sue the United States as he would have had if the decision had

been made by the President of the United States under the Acts hereby

repealed.

SEC. 3. (a) That section 3 of the "Shipping Act, 1916," is amended to

read as follows:

"SEC. 3. That a board is hereby created to be known as the United States

Shipping Board and hereinafter referred to as the board. The board shall

be composed of seven commissioners, to be appointed by the President, by

and with the advice and consent of the Senate; and the President shall

designate the member to act as chairman of the board, and the board may

elect one of its members as vice chairman. Such commissioners shall be

appointed as soon as practicable after the enactment of this Act and

shall continue in office two for a term of one year, and the remaining

five for terms of two, three, four, five, and six years, respectively,

from the date of their appointment, the term of each to be designated by

the President, but their successors shall be appointed for terms of six

years, except that any person chosen to fill a vacancy shall be

appointed only for the unexpired term of the commissioner whom he

succeeds.

"The commissioners shall be appointed with due regard to their fitness

for the efficient discharge of the duties imposed on them by this Act,

and two shall be appointed from the States touching the Pacific Ocean,

two from the States touching the Atlantic Ocean, one from the States

touching the Gulf of Mexico, one from the States touching the Great

Lakes and one from the interior, but not more than one shall be

appointed from the same State. Not more than four of the commissioners

shall be appointed from the same political party. A vacancy in the board

shall be filled in the same manner as the original appointments. No

commissioner shall take any part in the consideration or decision of any

claim or particular controversy in which he has a pecuniary interest.

"Each commissioner shall devote his time to the duties of his office,

and shall not be in the employ of or hold any official relation to any

common carrier or other person subject to this Act, nor while holding

such office acquire any stock or bonds thereof or become pecuniarily

interested in any such carrier.

"The duties of the board may be so divided that under its supervision

the directorship of various activities may be assigned to one or more

commissioners. Any commissioner may be removed by the President for

inefficiency, neglect of duty, or malfeasance in office. A vacancy in

the board shall not impair the right of the remaining members of the

board to exercise all its powers. The board shall have an official seal,

which shall be judicially noticed.

"The board may adopt rules and regulations in regard to its procedure

and the conduct of its business. The board may employ within the limits

of appropriations made therefor by Congress such attorneys as it finds

necessary for proper legal service to the board in the conduct of its

work, or for proper representation of the public interest in

investigations made by it or proceedings pending before it whether at

the board's own instance or upon complaint, or to appear for or

represent the board in any case in court or other tribunal. The board

shall have such other rights and perform such other duties not

inconsistent with the Merchant Marine Act, 1920, as are conferred by

existing law upon the board in existence at the time this section as

amended takes effect.

"The commissioners in office at the time this section as amended takes

effect shall hold office until all the commissioners provided for in

this section as amended are appointed and qualify."

(b) The first sentence of section 4 of the "Shipping Act, 1916," is

amended to read as follows:

"SEC. 4. That each member of the board shall receive a salary of $12,000

per annum."

SEC. 4. That all vessels and other property or interests of whatsoever

kind, including vessels or property in course of construction or

contracted for, acquired by the President through any agencies

whatsoever in pursuance of authority conferred by the Acts or parts of

Acts repealed by section 2 of this Act, or in pursuance of the joint

resolution entitled "Joint resolution authorizing the President to take

over for the United States the possession and title of any vessel within

its jurisdiction, which at the time of coming therein was owned in whole

or in part by any corporation, citizen, or subject of any nation with

which the United States may be at war, or was under register of any such

nation, and for other purposes," approved May 12, 1917, with the

exception of vessels and property the use of which is in the opinion of

the President required by any other branch of the Government service of

the United States, are hereby transferred to the board: _Provided_, That

all vessels in the military and naval service of the United States,

including the vessels assigned to river and harbor work, inland

waterways, or vessels for such needs in the course of construction or

under contract by the War Department, shall be exempt from the

provisions of this Act.

SEC. 5. That in order to accomplish the declared purposes of this Act,

and to carry out the policy declared in section 1 hereof, the board is

authorized and directed to sell, as soon as practicable, consistent with

good business methods and the objects and purposes to be attained by

this Act, at public or private competitive sale after appraisement and

due advertisement, to persons who are citizens of the United States

except as provided in section 6 of this Act, all of the vessels referred

to in section 4 of this Act or otherwise acquired by the board. Such

sale shall be made at such prices and on such terms and conditions as

the board may prescribe, but the completion of the payment of the

purchase price and interest shall not be deferred more than fifteen

years after the making of the contract of sale. The board in fixing or

accepting the sale price of such vessels shall take into consideration

the prevailing domestic and foreign market price of, the available

supply of, and the demand for vessels, existing freight rates and

prospects of their maintenance, the cost of constructing vessels of

similar types under prevailing conditions, as well as the cost of the

construction or purchase price of the vessels to be sold, and any other

facts or conditions that would influence a prudent, solvent business man

in the sale of similar vessels or property which he is not forced to

sell. All sales made under the authority of this Act shall be subject to

the limitations and restrictions of section 9 of the "Shipping Act,

1916," as amended.

SEC. 6. That the board is authorized and empowered to sell to aliens, at

such prices and on such terms and conditions as it may determine, not

inconsistent with the provisions of section 5 (except that completion of

the payment of the purchase price and interest shall not be deferred

more than ten years after the making of the contract of sale), such

vessels as it shall, after careful investigation, deem unnecessary to

the promotion and maintenance of an efficient American merchant marine;

but no such sale shall be made unless the board, after diligent effort,

has been unable to sell, in accordance with the terms and conditions of

section 5, such vessels to persons citizens of the United States, and

has, upon an affirmative vote of not less than five of its members,

spread upon the minutes of the board, determined to make such sale; and

it shall make as a part of its records a full statement of its reasons

for making such sale. Deferred payments of purchase price of vessels

under this section shall bear interest at the rate of not less than

5-1/2 per centum per annum, payable semiannually.

SEC. 7. That the board is authorized and directed to investigate and

determine as promptly as possible after the enactment of this Act and

from time to time thereafter what steamship lines should be established

and put in operation from ports in the United States or any Territory,

District, or possession thereof to such world and domestic markets as in

its judgment are desirable for the promotion, development, expansion,

and maintenance of the foreign and coastwise trade of the United States

and an adequate postal service, and to determine the type, size, speed,

and other requirements of the vessels to be employed upon such lines and

the frequency and regularity of their sailings, with a view to

furnishing adequate, regular, certain, and permanent service. The board

is authorized to sell, and if a satisfactory sale can not be made, to

charter such of the vessels referred to in section 4 of this Act or

otherwise acquired by the board, as will meet these requirements to

responsible persons who are citizens of the United States who agree to

establish and maintain such lines upon such terms of payment and other

conditions as the board may deem just and necessary to secure and

maintain the service desired; and if any such steamship line is deemed

desirable and necessary, and if no such citizen can be secured to supply

such service by the purchase or charter of vessels on terms satisfactory

to the board, the board shall operate vessels on such line until the

business is developed so that such vessels may be sold on satisfactory

terms and the service maintained, or unless it shall appear within a

reasonable time that such line can not be made self-sustaining. The

Postmaster General is authorized, notwithstanding the Act entitled "An

Act to provide for ocean mail service between the United States and

foreign ports, and to promote commerce," approved March 3, 1891, to

contract for the carrying of the mails over such lines at such price as

may be agreed upon by the board and the Postmaster General: _Provided_,

That preference in the sale or assignment of vessels for operation on

such steamship lines shall be given to persons who are citizens of the

United States who have the support, financial and otherwise, of the

domestic communities primarily interested in such lines if the board is

satisfied of the ability of such persons to maintain the service desired

and proposed to be maintained, or to persons who are citizens of the

United States who may then be maintaining a service from the port of the

United States to or in the general direction of the world market port to

which the board has determined that such service should be established:

_Provided further_, That where steamship lines and regular service have

been established and are being maintained by ships of the board at the

time of the enactment of this Act, such lines and service shall be

maintained by the board until, in the opinion of the board, the

maintenance thereof is unbusinesslike and against the public interests:

_And provided further_, That whenever the board shall determine, as

provided in this Act, that trade conditions warrant the establishment of

a service or additional service under Government administration where a

service is already being given by persons, citizens of the United

States, the rates and charges for such Government service shall not be

less than the cost thereof, including a proper interest and depreciation

charge on the value of Government vessels and equipment employed therein.

SEC. 8. That it shall be the duty of the board, in coöperation with the

Secretary of War, with the object of promoting, encouraging, and

developing ports and transportation facilities in connection with water

commerce over which it has jurisdiction, to investigate territorial

regions and zones tributary to such ports, taking into consideration the

economies of transportation by rail, water and highway and the natural

direction of the flow of commerce; to investigate the causes of the

congestion of commerce at ports and the remedies applicable thereto; to

investigate the subject of water terminals, including the necessary

docks, warehouses, apparatus, equipment, and appliances in connection

therewith, with a view to devising and suggesting the types most

appropriate for different locations and for the most expeditious and

economical transfer or interchange of passengers or property between

carriers by water and carriers by rail; to advise with communities

regarding the appropriate location and plan of construction of wharves,

piers, and water terminals; to investigate the practicability and

advantages of harbor, river, and port improvements in connection with

foreign and coastwise trade; and to investigate any other matter that

may tend to promote and encourage the use by vessels of ports adequate

to care for the freight which would naturally pass through such ports:

_Provided_, That if after such investigation the board shall be of the

opinion that rates, charges, rules, or regulations of common carriers by

rail subject to the jurisdiction of the Interstate Commerce Commission

are detrimental to the declared object of this section, or that new

rates, charges, rules, or regulations, new or additional port terminal

facilities, or affirmative action on the part of such common carriers by

rail is necessary to promote the objects of this section, the board may

submit its findings to the Interstate Commerce Commission for such

action as such commission may consider proper under existing law.

SEC. 9. That if the terms and conditions of any sale of a vessel made

under the provisions of this Act include deferred payments of the

purchase price, the board shall require, as part of such terms and

conditions, that the purchaser of the vessel shall keep the same insured

(a) against loss or damage by fire, and against marine risks and

disasters, and war and other risks if the board so specifies, with such

insurance companies, associations or underwriters, and under such forms

of policies, and to such an amount, as the board may prescribe or

approve; and (b) by protection and indemnity insurance with such

insurance companies, associations, or underwriters and under such forms

of policies, and to such an amount as the board may prescribe or

approve. The insurance required to be carried under this section shall

be made payable to the board and/or to the parties as interest may

appear. The board is authorized to enter into any agreement that it

deems wise in respect to the payment and/or the guarantee of premiums of

insurance.

SEC. 10. That the board may create out of net revenue from operations

and sales, and maintain and administer, a separate insurance fund, which

it may use to insure in whole or in part, against all hazards commonly

covered by insurance policies in such cases, any interest of the United

States (1) in any vessel, either constructed or in process of

construction, and (2) in any plants or materials heretofore or hereafter

acquired by the board or hereby transferred to the board.

SEC. 11. That during a period of five years from the enactment of this

Act the board may annually set aside out of the revenues from sales and

operations a sum not exceeding $25,000,000, to be known as its

construction loan fund, to be used in aid of the construction of vessels

of the best and most efficient type for the establishment and

maintenance of service on steamship lines deemed desirable and necessary

by the board, and such vessels shall be equipped with the most modern,

the most efficient and the most economical machinery and commercial

appliances. The board shall use such fund to the extent required upon

such terms as the board may prescribe to aid persons, citizens of the

United States, in the construction by them in private shipyards in the

United States of the foregoing class of vessels. No aid shall be for a

greater sum than two-thirds of the cost of the vessel or vessels to be

constructed, and the board shall require such security, including a

first lien upon the entire interest in the vessel or vessels so

constructed as it shall deem necessary to insure the repayment of such

sum with interest thereon and the maintenance of the service for which

such vessel or vessels are built.

SEC. 12. That all vessels may be reconditioned and kept in suitable

repair and until sold shall be managed and operated by the board or

chartered or leased by it on such terms and conditions as the board

shall deem wise for the promotion and maintenance of an efficient

merchant marine, pursuant to the policy and purposes declared in

sections 1 and 5 of this Act; and the United States Shipping Board

Emergency Fleet Corporation shall continue in existence and have

authority to operate vessels, unless otherwise directed by law, until

all vessels are sold in accordance with the provisions of this Act, the

provision in section 11 of the "Shipping Act, 1916," to the contrary

notwithstanding.

SEC. 13. That the board is further authorized to sell all property other

than vessels transferred to it under section 4 upon such terms and

conditions, as the board may determine and prescribe.

SEC. 14. That the net proceeds derived by the board prior to July 1,

1921, from any activities authorized by this Act, or by the "Shipping

Act, 1916," or by the Acts specified in section 2 of this Act, except

such an amount as the board shall deem necessary to withhold as

operating capital, for the purposes of section 12 hereof, and for the

insurance fund authorized in section 10 hereof, and for the construction

loan fund authorized in section 11 hereof, shall be covered into the

Treasury of the United States to the credit of the board and may be

expended by it, within the limits of the amounts heretofore or hereafter

authorized, for the construction, requisitioning, or purchasing of

vessels. After July 1, 1921, such net proceeds, less such an amount as

may be authorized annually by Congress to be withheld as operating

capital, and less such sums as may be needed for such insurance and

construction loan funds, shall be covered into the Treasury of the

United States as miscellaneous receipts. The board shall, as rapidly as

it deems advisable, withdraw investment of Government funds made during

the emergency under the authority conferred by the Acts or parts of Acts

repealed by section 2 of this Act and cover the net proceeds thereof

into the Treasury of the United States as miscellaneous receipts.

SEC. 15. That the board shall not require payment from the War

Department for the charter hire of vessels owned by the United States

Government furnished by the board from July 1, 1918, to June 30, 1919,

inclusive, for the use of such department.

SEC. 16. That all authorization to purchase, build, requisition, lease,

exchange, or otherwise acquire houses, buildings or land under the Act

entitled "An Act to authorize and empower the United States Shipping

Board Emergency Fleet Corporation to purchase, lease, requisition, or

otherwise acquire, and to sell or otherwise dispose of improved or

unimproved lands, houses, buildings, and for other purposes," approved

March 1, 1918, is hereby terminated: _Provided, however_, That

expenditures may be made under said Act for the repair of houses and

buildings already constructed, and the completion of such houses or

buildings as have heretofore been contracted for or are under

construction, if considered advisable, and the board is authorized and

directed to dispose of all such properties or the interest of the United

States in all such properties at as early a date as practicable,

consistent with good business and the best interests of the United

States.

SEC. 17. That the board is authorized and directed to take over on

January 1, 1921, the possession and control of, and to maintain and

develop, all docks, piers, warehouses, wharves and terminal equipment

and facilities, including all leasehold easements, rights of way,

riparian rights and other rights, estates and interests therein or

appurtenant thereto, acquired by the President by or under the Act

entitled "An Act making appropriations to supply urgent deficiencies in

appropriations for the fiscal year ending June 30, 1918, and prior

fiscal years, on account of war expenses, and for other purposes,"

approved March 28, 1918.

The possession and control of such other docks, piers, warehouses,

wharves and terminal equipment and facilities or parts thereof,

including all leasehold easements, rights of way, riparian rights and

other rights, estates or interests therein or appurtenant thereto which

were acquired by the War Department or the Navy Department for military

or naval purposes during the war emergency may be transferred by the

President to the board whenever the President deems such transfer to be

for the best interests of the United States.

The President may at any time he deems it necessary, by order setting

out the need therefor and fixing the period of such need, permit or

transfer the possession and control of any part of the property taken

over by or transferred to the board under this section to the War

Department or the Navy Department for their needs, and when in the

opinion of the President such need therefor ceases the possession and

control of such property shall revert to the board. None of such

property shall be sold except as may be hereafter provided by law.

SEC. 18. That section 9 of the "Shipping Act, 1916," is amended to read

as follows:

"SEC. 9. That any vessel purchased, chartered, or leased from the board,

by persons who are citizens of the United States, may be registered or

enrolled and licensed, or both registered and enrolled and licensed, as

a vessel of the United States and entitled to the benefits and

privileges appertaining thereto: _Provided_, That foreign-built vessels

admitted to American registry or enrollment and license under this Act,

and vessels owned by any corporation in which the United States is a

stockholder, and vessels sold, leased, or chartered by the board to any

person a citizen of the United States, as provided in this Act, may

engage in the coastwise trade of the United States while owned, leased,

or chartered by such a person.

"Every vessel purchased, chartered, or leased from the board shall,

unless otherwise authorized by the board, be operated only under such

registry or enrollment and license. Such vessels while employed solely

as merchant vessels shall be subject to all laws, regulations, and

liabilities governing merchant vessels, whether the United States be

interested therein as owner, in whole or in part, or hold any mortgage,

lien, or other interest therein.

"It shall be unlawful to sell, transfer or mortgage, or, except under

regulations prescribed by the board, to charter, any vessel purchased

from the board or documented under the laws of the United States to any

person not a citizen of the United States, or to put the same under a

foreign registry or flag, without first obtaining the board's approval.

"Any vessel chartered, sold, transferred or mortgaged to a person not a

citizen of the United States or placed under a foreign registry or flag,

or operated, in violation of any provision of this section shall be

forfeited to the United States, and whoever violates any provision of

this section shall be guilty of a misdemeanor and subject to a fine of

not more than $5,000, or to imprisonment for not more than five years,

or both."

SEC. 19. (1) The board is authorized and directed in aid of the

accomplishment of the purposes of this Act

(a) To make all necessary rules and regulations to carry out the

provisions of this Act;

(b) To make rules and regulations affecting shipping in the foreign

trade not in conflict with law in order to adjust or meet general or

special conditions unfavorable to shipping in the foreign trade, whether

in any particular trade or upon any particular route or in commerce

generally and which arise out of or result from foreign laws, rules, or

regulations or from competitive methods or practices employed by owners,

operators, agents, or masters of vessels of a foreign country; and

(c) To request the head of any department, board, bureau, or agency of

the Government to suspend, modify, or annul rules or regulations which

have been established by such department, board, bureau, or agency, or

to make new rules or regulations affecting shipping in the foreign trade

other than such rules or regulations relating to the Public Health

Service, the Consular Service, and the Steamboat Inspection Service.

(2) No rule or regulation shall hereafter be established by any

department, board, bureau, or agency of the Government which affect

shipping in the foreign trade, except rules or regulations affecting the

Public Health Service, the Consular Service, and the Steamboat

Inspection Service, until such rule or regulation has been submitted to

the board for its approval and final action has been taken thereon by

the board or the President.

(3) Whenever the head of any department, board, bureau, or agency of the

Government refuses to suspend, modify, or annul any rule or regulation,

or make a new rule or regulation upon request of the board, as provided

in subdivision (c) of paragraph (1) of this section, or objects to the

decision of the board in respect to the approval of any rule or

regulation, as provided in paragraph (2) of this section, either the

board or the head of the department, board, bureau, or agency which has

established or is attempting to establish the rule or regulation in

question may submit the facts to the President, who is hereby authorized

to establish or suspend, modify, or annul such rule or regulation.

(4) No rule or regulation shall be established which in any manner gives

vessels owned by the United States any preference or favor over those

vessels documented under the laws of the United States and owned by

persons who are citizens of the United States.

SEC. 20. (1) That section 14 of the Shipping Act, 1916, as amended, is

amended to read as follows:

"SEC. 14. That no common carrier by water shall, directly or indirectly,

in respect to the transportation by water of passengers or property

between a port of a State, Territory, District, or possession of the

United States and any other such port or a port of a foreign country,--

"First. Pay, or allow, or enter into any combination, agreement, or

understanding, express or implied, to pay or allow, a deferred rebate to

any shipper. The term 'deferred rebate' in this Act means a return of

any portion of the freight money by a carrier to any shipper as a

consideration for the giving of all or any portion of his shipments to

the same or any other carrier, or for any other purpose, the payment of

which is deferred beyond the completion of the service for which it is

paid, and is made only if, during both the period for which computed and

the period of deferment, the shipper has complied with the terms of the

rebate agreement or arrangement.

"Second. Use a fighting ship either separately or in conjunction with

any other carrier, through agreement or otherwise. The term 'fighting

ship' in this Act means a vessel used in a particular trade by a carrier

or group of carriers for the purpose of excluding, preventing or

reducing competition by driving another carrier out of said trade.

"Third. Retaliate against any shipper by refusing, or threatening to

refuse, space accommodations when such are available, or resort to other

discriminating or unfair methods, because such shipper has patronized

any other carrier or has filed a complaint charging unfair treatment, or

for any other reason.

"Fourth. Make any unfair or unjustly discriminatory contract with any

shipper based on the volume of freight offered, or unfairly treat or

unjustly discriminate against any shipper in the matter of (a) cargo

space accommodations or other facilities, due regard being had for the

proper loading of the vessel and the available tonnage; (b) the loading

and landing of freight in proper condition; or (c) the adjustment and

settlement of claims.

"Any carrier who violates any provision of this section shall be guilty

of a misdemeanor punishable by a fine of not more than $25,000 for each

offense."

(2) The Shipping Act, 1916, as amended, is amended by inserting after

section 14 a new section to read as follows:

"SEC. 14A. The board upon its own initiative may, or upon complaint

shall, after due notice to all parties in interest and hearing,

determine whether any person, not a citizen of the United States and

engaged in transportation by water of passengers or property--

"(1) Has violated any provision of section 14, or

"(2) Is a party to any combination, agreement, or understanding, express

or implied, that involves in respect to transportation of passengers or

property between foreign ports, deferred rebates or any other unfair

practice designated in section 14, and that excludes from admission upon

equal terms with all other parties thereto, a common carrier by water

which is a citizen of the United States and which has applied for such

admission.

"If the board determines that any such person has violated any such

provision or is a party to any such combination, agreement, or

understanding, the board shall thereupon certify such fact to the

Secretary of Commerce. The Secretary shall thereafter refuse such person

the right of entry for any ship owned or operated by him or by any

carrier directly or indirectly controlled by him, into any port of the

United States, or any Territory, District, or possession thereof, until

the board certifies that the violation has ceased or such combination,

agreement, or understanding has been terminated."

SEC. 21. That from and after February 1, 1922, the coastwise laws of the

United States shall extend to the island Territories and possessions of

the United States not now covered thereby, and the board is directed

prior to the expiration of such year to have established adequate

steamship service at reasonable rates to accommodate the commerce and

the passenger travel of said islands and to maintain and operate such

service until it can be taken over and operated and maintained upon

satisfactory terms by private capital and enterprise: _Provided_, That

if adequate shipping service is not established by February 1, 1922, the

President shall extend the period herein allowed for the establishment

of such service in the case of any island Territory or possession for

such time as may be necessary for the establishment of adequate shipping

facilities therefor: _Provided further_, That until Congress shall have

authorized the registry as vessels of the United States of vessels owned

in the Philippine Islands, the Government of the Philippine Islands is

hereby authorized to adopt, from time to time, and enforce regulations

governing the transportation of merchandise and passengers between ports

or places in the Philippine Archipelago: _And provided further_, That

the foregoing provisions of this section shall not take effect with

reference to the Philippine Islands until the President of the United

States after a full investigation of the local needs and conditions

shall, by proclamation, declare that an adequate shipping service has

been established as herein provided and fix a date for the going into

effect of the same.

SEC. 22. That the Act entitled "An Act giving the United States Shipping

Board power to suspend present provisions of law and permit vessels of

foreign registry and foreign-built vessels admitted to American registry

under the Act of August 18, 1914, to engage in the coastwise trade

during the present war and for a period of one hundred and twenty days

thereafter, except the coastwise trade with Alaska," approved October 6,

1917, is hereby repealed: _Provided_, That all foreign-built vessels

admitted to American registry, owned on February 1, 1920, by persons

citizens of the United States, and all foreign-built vessels owned by

the United States at the time of the enactment of this Act, when sold

and owned by persons citizens of the United States, may engage in the

coastwise trade so long as they continue in such ownership, subject to

the rules and regulations of such trade: _Provided_, That the board is

authorized to issue permits for the carrying of passengers in foreign

ships if it deems it necessary so to do, operating between the Territory

of Hawaii and the Pacific Coast up to February 1, 1922.

SEC. 23. That the owner of a vessel documented under the laws of the

United States and operated in foreign trade shall, for each of the ten

taxable years while so operated, beginning with the first taxable year

ending after the enactment of this Act, be allowed as a deduction for

the purpose of ascertaining his net income subject to the war-profits

and excess-profits taxes imposed by Title III of the Revenue Act of 1918

an amount equivalent to the net earnings of such vessel during such

taxable year, determined in accordance with rules and regulations to be

made by the board: _Provided_, That such owner shall not be entitled to

such deduction unless during such taxable year he invested, or set aside

under rules and regulations to be made by the board in a trust fund for

investment, in the building in shipyards in the United States of new

vessels of a type and kind approved by the board, an amount, to be

determined by the Secretary of the Treasury and certified by him to the

board, equivalent to the war-profits and excess-profits taxes that would

have been payable by such owner on account of the net earnings of such

vessels but for the deduction allowed under the provisions of this

section: _Provided further_, That at least two-thirds of the cost of any

vessel constructed under this paragraph shall be paid for out of the

ordinary funds or capital of the person having such vessel constructed.

That during the period of ten years from the enactment of this Act any

person a citizen of the United States who may sell a vessel documented

under the laws of the United States and built prior to January 1, 1914,

shall be exempt from all income taxes that would be payable upon any of

the proceeds of such sale under Title I, Title II, and Title III of the

Revenue Act of 1918 if the entire proceeds thereof shall be invested in

the building of new ships in American shipyards, such ships to be

documented under the laws of the United States and to be of a type

approved by the board.

SEC. 24. That all mails of the United States shipped or carried on

vessels shall, if practicable, be shipped or carried on American-built

vessels documented under the laws of the United States. No contract

hereafter made with the Postmaster General for carrying mails on vessels

so built and documented shall be assigned or sublet, and no mails

covered by such contract shall be carried on any vessel not so built and

documented. No money shall be paid out of the Treasury of the United

States on or in relation to any such contract for carrying mails on

vessels so built and documented when such contract has been assigned or

sublet or when mails covered by such contract are in violation of the

terms thereof carried on any vessel not so built and documented. The

board and the Postmaster General, in aid of the development of a

merchant marine adequate to provide for the maintenance and expansion of

the foreign or coastwise trade of the United States and of a

satisfactory postal service in connection therewith, shall from time to

time determine the just and reasonable rate of compensation to be paid

for such service, and the Postmaster General is hereby authorized to

enter into contracts within the limits of appropriations made therefor

by Congress to pay for the carrying of such mails in such vessels at

such rate. Nothing herein shall be affected by the Act entitled "An Act

to provide for ocean mail service between the United States and foreign

ports, and to promote commerce," approved March 3, 1891.

SEC. 25. That for the classification of vessels owned by the United

States, and for such other purposes in connection therewith as are the

proper functions of a classification bureau, all departments, boards,

bureaus, and commissions of the Government are hereby directed to

recognize the American Bureau of Shipping as their agency so long as the

American Bureau of Shipping continues to be maintained as an

organization which has no capital stock and pays no dividends:

_Provided_, That the Secretary of Commerce and the chairman of the board

shall each appoint one representative who shall represent the Government

upon the executive committee of the American Bureau of Shipping, and the

bureau shall agree that these representatives shall be accepted by them

as active members of such committee. Such representatives of the

Government shall serve without any compensation, except necessary

traveling expenses: _Provided further_, That the official list of

merchant vessels published by the Government shall hereafter contain a

notation clearly indicating all vessels classed by the American Bureau

of Shipping.

SEC. 26. That cargo vessels documented under the laws of the United

States may carry not to exceed sixteen persons in addition to the crew

between any ports or places in the United States or its Districts,

Territories, or possessions, or between any such port or place and any

foreign port, or from any foreign port to another foreign port, and such

vessels shall not be held to be "passenger vessels" or "vessels carrying

passengers" within the meaning of the inspection laws and the rules and

regulations thereunder: _Provided_, That nothing herein shall be taken

to exempt such vessels from the laws, rules, and regulations respecting

life-saving equipment: _Provided further_, That when any such vessel

carries persons other than the crew as herein provided for, the owner,

agent, or master of the vessel shall first notify such persons of the

presence on board of any dangerous articles, as defined by law, or of

any other condition or circumstances which would constitute a risk of

safety for passenger or crew.

The privilege bestowed by this section on vessels of the United States

shall be extended insofar as the foreign trade is concerned to the cargo

vessels of any nation which allows the like privilege to cargo vessels

of the United States in trades not restricted to vessels under its own

flag.

Failure on the part of the owner, agent, or master of the vessel to give

such notice shall subject the vessel to a penalty of $500, which may be

mitigated or remitted by the Secretary of Commerce upon a proper

representation of the facts.

SEC. 27. That no merchandise shall be transported by water, or by land

and water, on penalty of forfeiture thereof, between points in the

United States, including Districts, Territories, and possessions thereof

embraced within the coastwise laws, either directly or via a foreign

port, or for any part of the transportation, in any other vessel than a

vessel built in and documented under the laws of the United States and

owned by persons who are citizens of the United States, or vessels to

which the privilege of engaging in the coastwise trade is extended by

sections 18 or 22 of this Act: _Provided_, That this section shall not

apply to merchandise transported between points within the continental

United States, excluding Alaska, over through routes heretofore or

hereafter recognized by the Interstate Commerce Commission for which

routes rate tariffs have been or shall hereafter be filed with said

commission when such routes are in part over Canadian rail lines and

their own or other connecting water facilities: _Provided further_, That

this section shall not become effective upon the Yukon river until the

Alaska Railroad shall be completed and the Shipping Board shall find

that proper facilities will be furnished for transportation by persons

citizens of the United States for properly handling the traffic.

SEC. 28. That no common carrier shall charge, collect, or receive, for

transportation subject to the Interstate Commerce Act of persons or

property, under any joint rate, fare, or charge, or under any export,

import, or other proportional rate, fare, or charge, which is based in

whole, or in part on the fact that the persons or property affected

thereby is to be transported to, or has been transported from, any port

in a possession or dependency of the United States, or in a foreign

country, by a carrier by water in foreign commerce, any lower rate,

fare, or charge than that charged, collected, or received by it for the

transportation of persons, or of a like kind of property, for the same

distance, in the same direction, and over the same route, in connection

with commerce wholly within the United States, unless the vessel so

transporting such persons or property is, or unless it was at the time

of such transportation by water, documented under the laws of the United

States. Whenever the board is of the opinion, however, that adequate

shipping facilities to or from any port in a possession or dependency of

the United States or a foreign country are not afforded by vessels so

documented, it shall certify this fact to the Interstate Commerce

Commission, and the commission may, by order, suspend the operation of

the provisions of this section with respect to the rates, fares, and

charges for the transportation by rail of persons and property

transported from, or to be transported, to such ports, for such length

of time and under such terms and conditions as it may prescribe in such

order, or in any order supplemental thereto. Such suspension of

operation of the provisions of this section may be terminated by order

of the commission whenever the board is of the opinion that adequate

shipping facilities by such vessels to such ports are afforded and shall

so certify to the commission.

SEC. 29. (a) That whenever used in this section--

(1) The term "association" means any association, exchange, pool,

combination, or other arrangement for concerted action; and

(2) The term "marine insurance companies" means any persons, companies,

or associations, authorized to write marine insurance or reinsurance

under the laws of the United States or of a State, Territory, District,

or possession thereof.

(b) Nothing contained in the "antitrust laws" as designated in section 1

of the Act entitled "An Act to supplement existing laws against unlawful

restraints and monopolies, and for other purposes," approved October 15,

1914, shall be construed as declaring illegal an association entered

into by marine insurance companies for the following purposes: To

transact a marine insurance and reinsurance business in the United

States and in foreign countries and to reinsure or otherwise apportion

among its membership the risks undertaken by such association or any of

the component members.

SEC. 30. Subsection A. That this section may be cited as the "Ship

Mortgage Act, 1920."

DEFINITIONS.

Subsection B. When used in this section--

(1) The term "document" includes registry and enrollment and license;

(2) The term "documented" means registered or enrolled or licensed under

the laws of the United States, whether permanently or temporarily;

(3) The term "port of documentation" means the port at which the vessel

is documented, in accordance with law;

(4) The term "vessel of the United States" means any vessel documented

under the laws of the United States and such vessel shall be held to

continue to be so documented until its documents are surrendered with

the approval of the board; and

(5) The term "mortgagee," in the case of a mortgage involving a trust

deed and a bond issue thereunder, means the trustee designated in such

deed.

RECORDING OF SALES, CONVEYANCES, AND MORTGAGES OF VESSELS OF THE UNITED

STATES.

Subsection C. (a) 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, as

provided in subdivision (b) of this subsection.

(b) Such collector of customs shall record bills of sale, conveyances,

and mortgages, delivered to him, in the order of their reception, in

books to be kept for that purpose and indexed to show--

(1) The name of the vessel;

(2) The names of the parties to the sale, conveyance, or mortgage;

(3) The time and date of reception of the instrument;

(4) The interest in the vessel so sold, conveyed, or mortgaged; and

(5) The amount and date of maturity of the mortgage.

Subsection D. (a) A valid mortgage which, at the time it is made

includes the whole of any vessel of the United States of 200 gross tons

and upwards, shall in addition have, in respect to such vessel and as of

the date of the compliance with all the provisions of this subdivision,

the preferred status given by the provisions of subsection M, if--

(1) The mortgage is indorsed upon the vessel's documents in accordance

with the provisions of this section;

(2) The mortgage is recorded as provided in subsection C, together with

the time and date when the mortgage is so indorsed;

(3) An affidavit is filed with the record of such mortgage to the effect

that the mortgage is made in good faith and without any design to

hinder, delay, or defraud any existing or future creditor of the

mortgagor or any lienor of the mortgaged vessel;

(4) The mortgage does not stipulate that the mortgagee waives the

preferred status thereof; and

(5) The mortgagee is a citizen of the United States.

(b) Any mortgage which complies in respect to any vessel with the

conditions enumerated in this subsection is hereafter in this section

called a "preferred mortgage" as to such vessel.

(c) There shall be indorsed upon the documents of a vessel covered by a

preferred mortgage--

(1) The name of the mortgagor and mortgagee;

(2) The time and date the indorsement is made;

(3) The amount and date of maturity of the mortgage; and

(4) Any amount required to be indorsed by the provisions of subdivision

(e) or (f) of this subsection.

(d) Such indorsement shall be made (1) by the collector of customs of

the port of documentation of the mortgaged vessel, or (2) by the

collector of customs of any port in which the vessel is found, if such

collector is directed to make the indorsement by the collector of

customs of the port of documentation; and no clearance shall be issued

to the vessel until such indorsement is made. The collector of customs

of the port of documentation shall give such direction by wire or letter

at the request of the mortgagee and upon the tender of the cost of

communication of such direction. Whenever any new document is issued for

the vessel, such indorsement shall be transferred to and indorsed upon

the new document by the collector of customs.

(e) A mortgage which includes property other than a vessel shall not be

held a preferred mortgage unless the mortgage provides for the separate

discharge of such property by the payment of a specified portion of the

mortgage indebtedness. If a preferred mortgage so provides for the

separate discharge, the amount of the portion of such payment shall be

indorsed upon the documents of the vessel.

(f) If a preferred mortgage includes more than one vessel and provides

for the separate discharge of each vessel by the payment of a portion of

the mortgage indebtedness, the amount of such portion of such payment

shall be indorsed upon the documents of the vessel. In case such

mortgage does not provide for the separate discharge of a vessel and the

vessel is to be sold upon the order of a district court of the United

States in a suit in rem in admiralty, the court shall determine the

portion of the mortgage indebtedness increased by 20 per centum (1)

which, in the opinion of the court, the approximate value of the vessel

bears to the approximate value of all the vessels covered by the

mortgage, and (2) upon the payment of which the vessel shall be

discharged from the mortgage.

Subsection E. The collector of customs upon the recording of a preferred

mortgage shall deliver two certified copies thereof to the mortgagor who

shall place, and use due diligence to retain, one copy on board the

mortgaged vessel and cause such copy and the documents of the vessel to

be exhibited by the master to any person having business with the

vessel, which may give rise to a maritime lien upon the vessel or to the

sale, conveyance, or mortgage thereof. The master of the vessel shall,

upon the request of any such person, exhibit to him the documents of the

vessel and the copy of any preferred mortgage of the vessel placed on

board thereof.

Subsection F. The mortgagor (1) shall, upon request of the mortgagee,

disclose in writing to him prior to the execution of any preferred

mortgage, the existence of any maritime lien, prior mortgage, or other

obligation or liability upon the vessel to be mortgaged, that is known

to the mortgagor, and (2), without the consent of the mortgagee, shall

not incur, after the execution of such mortgage and before the mortgagee

has had a reasonable time in which to record the mortgage and have

indorsements in respect thereto made upon the documents of the vessel,

any contractual obligation creating a lien upon the vessel other than a

lien for wages of stevedores when employed directly by the owner,

operator, master, ship's husband, or agent of the vessel, for wages of

the crew of the vessel, for general average, or for salvage, including

contract salvage, in respect to the vessel.

Subsection G. (a) The collector of customs of the port of documentation

shall, upon the request of any person, record notice of his claim of a

lien upon a vessel covered by a preferred mortgage, together with the

nature, date of creation, and amount of the lien, and the name and

address of the person. Any person who has caused notice of his claim of

lien to be so recorded shall, upon a discharge in whole or in part of

the indebtedness, forthwith file with the collector of customs a

certificate of such discharge. The collector of customs shall thereupon

record the certificate.

(b) The mortgagor, upon a discharge in whole or in part of the mortgage

indebtedness, shall forthwith file with the collector of customs for the

port of documentation of the vessel, a certificate of such discharge.

Such collector of customs shall thereupon record the certificate. In

case of a vessel covered by a preferred mortgage, the collector of

customs at the port of documentation shall (1) indorse upon the

documents of the vessel, or direct the collector of customs at any port

in which the vessel is found, to so indorse, the fact of such discharge,

and (2) shall deny clearance to the vessel until such indorsement is

made.

Subsection H. (a) No bill of sale, conveyance, or mortgage shall be

recorded unless it states the interest of the grantor or mortgagor in

the vessel, and the interest so sold, conveyed, or mortgaged.

(b) No bill of sale, conveyance, mortgage, notice of claim of lien, or

certificate of discharge thereof, shall be recorded unless previously

acknowledged before a notary public or other officer authorized by a law

of the United States, or of a State, Territory, District, or possession

thereof, to take acknowledgment of deeds.

(c) In case of a change in the port of documentation of a vessel of the

United States, no bill of sale, conveyance, or mortgage shall be

recorded at the new port of documentation unless there is furnished to

the collector of customs of such port, together with the copy of the

bill of sale, conveyance, or mortgage to be recorded, a certified copy

of the record of the vessel at the former port of documentation

furnished by the collector of such port. The collector of customs at the

new port of documentation is authorized and directed to record such

certified copy.

(d) A preferred mortgage may bear such rate of interest as is agreed by

the parties thereto.

Subsection I. Each collector of customs shall permit records made under

the provisions of this section to be inspected during office hours,

under such reasonable regulations as the collector may establish. Upon

the request of any person the collector of customs shall furnish him

from the records of the collector's office (1) a certificate setting

forth the names of the owners of any vessel, the interest held by each

owner, and the material facts as to any bill of sale or conveyance of,

any mortgage covering, or any lien or other incumbrance upon, a

specified vessel, (2) a certified copy of any bill of sale, conveyance,

mortgage, notice of claim of lien, or certificate of discharge in

respect to such vessel, or (3) a certified copy as required by

subdivision (c) of subsection H. The collector of customs shall collect

a fee for any bill of sale, conveyance, or mortgage recorded, or any

certificate or certified copy furnished, by him, in the amount of 20

cents a folio with a minimum charge of $1.00. All such fees shall be

covered into the Treasury of the United States as miscellaneous receipts.

PENALTIES.

Subsection J. (a) If the master of the vessel willfully fails to exhibit

the documents of the vessel or the copy of any preferred mortgage

thereof, as required by subsection E, the board of local inspectors of

vessels having jurisdiction of the license of the master, may suspend or

cancel such license, subject to the provisions of "An Act to provide for

appeals from decision of boards of local inspectors of vessels and for

other purposes," approved June 10, 1918.

(b) A mortgagor who, with intent to defraud, violates any provision of

subsection F, and if the mortgagor is a corporation or association, the

president or other principal executive officer of the corporation or

association, shall upon conviction thereof be held guilty of a

misdemeanor and shall be fined not more than $1,000 or imprisonment not

more than 2 years, or both. The mortgaged indebtedness shall thereupon

become immediately due and payable at the election of the mortgagee.

(c) If any person enters into any contract secured by, or upon the

credit of, a vessel of the United States covered by a preferred

mortgage, and suffers pecuniary loss by reason of the failure of the

collector of customs, or any officer, employee, or agent thereof,

properly to perform any duty required of the collector under the

provisions of this section, the collector of customs shall be liable to

such person for damages in the amount of such loss. If any such person

is caused any such loss by reason of the failure of the mortgagor, or

master of the mortgaged vessel, or any officer, employee, or agent

thereof, to comply with any provision of subsection E or F or to file an

affidavit as required by subdivision (a) of subsection D, correct in

each particular thereof, the mortgagor shall be liable to such person

for damages in the amount of such loss. The district courts of the

United States are given jurisdiction (but not to the exclusion of the

courts of the several States, Territories, Districts, or possessions) of

suits for the recovery of such damages, irrespective of the amount

involved in the suit or the citizenship of the parties thereto. Such

suit shall be begun by personal service upon the defendant within the

limits of the district. Upon judgment for the plaintiff in any such

suit, the court shall include in the judgment an additional amount for

costs of the action and a reasonable counsel's fee, to be fixed by the

court.

FORECLOSURE OF PREFERRED MORTGAGES.

Subsection K. A preferred mortgage shall constitute a lien upon the

mortgaged vessel in the amount of the outstanding mortgage indebtedness

secured by such vessel. Upon the default of any term or condition of the

mortgage, such lien may be enforced by the mortgagee by suit in rem in

admiralty. Original jurisdiction of all such suits is granted to the

district courts of the United States exclusively. In addition to any

notice by publication, actual notice of the commencement of any such

suit shall be given by the libellant, in such manner as the court shall

direct, to (1) the master, other ranking officer, or caretaker of the

vessel, and (2) any person who has recorded a notice of claim of an

undischarged lien upon the vessel, as provided in subsection G, unless

after search by the libellant satisfactory to the court, such mortgagor,

master, other ranking officer, caretaker, or claimant is not found

within the United States. Failure to give notice to any such person, as

required by this subsection, shall not constitute a jurisdictional

defect; but the libellant shall be liable to such person for damages in

the amount of his interest in the vessel terminated by the suit. Suit in

personam for the recovery of such damages may be brought in accordance

with the provisions of subdivision (c) of subsection J.

Subsection L. In any suit in rem in admiralty for the enforcement of the

preferred mortgage lien, the court may appoint a receiver and, in its

discretion, authorize the receiver to operate the mortgaged vessel. The

marshal may be authorized and directed by the court to take possession

of the mortgaged vessel notwithstanding the fact that the vessel is in

the possession or under the control of any person claiming a possessory

common-law lien.

Subsection M. (a) When used hereinafter in this section, the term

"preferred maritime lien" means (1) a lien arising prior in time to the

recording and indorsement of a preferred mortgage in accordance with the

provisions of this section; or (2) a lien for damages arising out of

tort, for wages of a stevedore when employed directly by the owner,

operator, master, ship's husband, or agent of the vessel, for wages of

the crew of the vessel, for general average, and for salvage, including

contract salvage.

(b) Upon the sale of any mortgaged vessel by order of a district court

of the United States in any suit in rem in admiralty for the enforcement

of a preferred mortgage lien thereon, all preëxisting claims in the

vessel, including any possessory common-law lien of which a lienor is

deprived under the provisions of subsection L shall be held terminated

and shall thereafter attach, in like amount and in accordance with their

respective priorities, to the proceeds of the sale; except that the

preferred mortgage lien shall have priority over all claims against the

vessel, except (1) preferred maritime liens, and (2) expenses and fees

allowed and costs taxed, by the court.

Subsection N. (a) Upon the default of any term or condition of a

preferred mortgage upon a vessel, the mortgagee may, in addition to all

other remedies granted by this section, bring suit in personam in

admiralty in a district court of the United States, against the

mortgagor for the amount of the outstanding mortgage indebtedness

secured by such vessel or any deficiency in the full payment thereof.

(b) This section shall not be construed, in the case of a mortgage

covering, in addition to vessels, realty or personalty other than

vessels, or both, to authorize the enforcement by suit in rem in

admiralty of the rights of the mortgagee in respect to such realty or

personalty other than vessels.

TRANSFERS OF MORTGAGED VESSELS AND ASSIGNMENT OF VESSEL MORTGAGES.

Subsection O. (a) The documents of a vessel of the United States covered

by a preferred mortgage may not be surrendered (except in the case of

the forfeiture of the vessel or its sale by the order of any court of

the United States or any foreign country) without the approval of the

board. The board shall refuse such approval unless the mortgagee

consents to such surrender.

(b) The interest of the mortgagee in a vessel of the United States

covered by a mortgage, shall not be terminated by the forfeiture of the

vessel for a violation of any law of the United States, unless the

mortgagee authorized, consented, or conspired to effect the illegal act,

failure, or omission which constituted such violation.

(c) Upon the sale of any vessel of the United States covered by a

preferred mortgage, by order of a district court of the United States in

any suit in rem in admiralty for the enforcement of a maritime lien

other than a preferred maritime lien, the vessel shall be sold free from

all preëxisting claims thereon; but the court shall, upon the request of

the mortgagee, the libellant, or an intervenor, require the purchaser at

such sale to give and the mortgagor to accept a new mortgage of the

vessel for the balance of the term of the original mortgage. The

conditions of such new mortgage shall be the same, so far as

practicable, as those of the original mortgage and shall be subject to

the approval of the court. If such new mortgage is given, the mortgagee

shall not be paid from the proceeds of the sale and the amount payable

as the purchase price shall be held diminished in the amount of the new

mortgage indebtedness.

(d) No rights under a mortgage of a vessel of the United States shall be

assigned to any person not a citizen of the United States without the

approval of the board. Any assignment in violation of any provision of

this section shall be void.

(e) No vessel of the United States shall be sold by order of a district

court of the United States in any suit in rem in admiralty to any person

not a citizen of the United States.

MARITIME LIENS FOR NECESSARIES.

Subsection P. Any person furnishing repairs, supplies, towage, use of

dry dock or marine railway, or other necessaries, to any vessel, whether

foreign or domestic, upon the order of the owner of such vessel, or of a

person authorized by the owner, shall have a maritime lien on the

vessel, which may be enforced by suit in rem, and it shall not be

necessary to allege or prove that credit was given to the vessel.

Subsection Q. The following persons shall be presumed to have authority

from the owner to procure repairs, supplies, towage, use of dry dock or

marine railway, and other necessaries for the vessel: The managing

owner, ship's husband, master, or any person to whom the management of

the vessel at the port of supply is intrusted. No person tortiously or

unlawfully in possession or charge of a vessel shall have authority to

bind the vessel.

Subsection R. The officers and agents of a vessel specified in

subsection Q shall be taken to include such officers and agents when

appointed by a charterer, by an owner pro hac vice, or by an agreed

purchaser in possession of the vessel; but nothing in this section shall

be construed to confer a lien when the furnisher knew, or by exercise of

reasonable diligence could have ascertained, that because of the terms

of a charter party, agreement for sale of the vessel, or for any other

reason, the person ordering the repairs, supplies, or other necessaries

was without authority to bind the vessel therefor.

Subsection S. Nothing in this section shall be construed to prevent the

furnisher of repairs, supplies, towage, use of dry dock or marine

railway, or other necessaries, or the mortgagee, from waiving his right

to a lien, or in the case of a preferred mortgage lien, to the preferred

status of such lien, at any time, by agreement or otherwise; and this

section shall not be construed to affect the rules of law now existing

in regard to (1) the right to proceed against the vessel for advances,

(2) laches in the enforcement of liens upon vessels, (3) the right to

proceed in personam, (4) the rank of preferred maritime liens among

themselves, or (5) priorities between maritime liens and mortgages,

other than preferred mortgages, upon vessels of the United States.

Subsection T. This section shall supersede the provisions of all State

statutes conferring liens on vessels, in so far as such statutes purport

to create rights of action to be enforced by suits in rem in admiralty

against vessels for repairs, supplies, towage, use of dry dock or marine

railway, and other necessaries.

MISCELLANEOUS PROVISIONS.

Subsection U. This section shall not apply (1) to any existing mortgage,

or (2) to any mortgage hereafter placed on any vessel now under an

existing mortgage, so long as such existing mortgage remains

undischarged.

Subsection V. The Secretary of Commerce is authorized and directed to

furnish collectors of customs with all necessary books and records, and

with certificates of registry and of enrollment and license in such form

as provides for the making of all indorsements thereon required by this

section.

Subsection W. The Secretary of Commerce is authorized to make such

regulations in respect to the recording and indorsing of mortgages

covering vessels of the United States, as he deems necessary to the

efficient execution of the provisions of this section.

Subsection X. Sections 4192 to 4196, inclusive, of the Revised Statutes

of the United States, as amended, and the Act entitled "An Act relating

to liens on vessels for repairs, supplies, or other necessaries,"

approved June 23, 1910, are repealed. This section, however, so far as

not inconsistent with any of the provisions of law so repealed, shall be

held a reënactment of such repealed law, and any right or obligation

based upon any provision of such law and accruing prior to such repeal,

may be prosecuted in the same manner and to the same effect as if this

Act had not been passed.

SEC. 31. That section 4530 of the Revised Statutes of the United States

is amended to read as follows:

"SEC. 4530. Every seaman on a vessel of the United States shall be

entitled to receive on demand from the master of the vessel to which he

belongs one-half part of the balance of his wages earned and remaining

unpaid at the time when such demand is made at every port where such

vessel, after the voyage has been commenced, shall load or deliver cargo

before the voyage is ended, and all stipulations in the contract to the

contrary shall be void: _Provided_, Such a demand shall not be made

before the expiration of, nor oftener than once in, five days nor more

than once in the same harbor on the same entry. Any failure on the part

of the master to comply with this demand shall release the seaman from

his contract and he shall be entitled to full payment of wages earned.

And when the voyage is ended every such seaman shall be entitled to the

remainder of the wages which shall be then due him, as provided in

section 4529 of the Revised Statutes: _Provided further_, That

notwithstanding any release signed by any seaman under section 4552 of

the Revised Statutes any court having jurisdiction may upon good cause

shown set aside such release and take such action as justice shall

require: _And provided further_, That this section shall apply to seamen

on foreign vessels while in harbors of the United States, and the courts

of the United States shall be open to such seamen for its enforcement."

SEC. 32. That paragraph (a) of section 10 of the Act entitled "An Act to

remove certain burdens on the American merchant marine and encourage the

American foreign carrying trade, and for other purposes," approved June

26, 1884, as amended, is hereby amended to read as follows:

"SEC. 10. (a) That it shall be, and is hereby, made unlawful in any case

to pay any seaman wages in advance of the time when he has actually

earned the same, or to pay such advance wages, or to make any order, or

note, or other evidence of indebtedness therefor to any other person, or

to pay any person, for the shipment of seamen when payment is deducted

or to be deducted from a seaman's wages. Any person violating any of the

foregoing provisions of this section shall be deemed guilty of a

misdemeanor, and upon conviction shall be punished by a fine of not less

than $25 nor more than $100, and may also be imprisoned for a period of

not exceeding six months, at the discretion of the court. The payment of

such advance wages or allotment, whether made within or without the

United States or territory subject to the jurisdiction thereof, shall in

no case except as herein provided absolve the vessel or the master or

the owner thereof from the full payment of wages after the same shall

have been actually earned, and shall be no defense to a libel suit or

action for the recovery of such wages. If any person shall demand or

receive, either directly or indirectly, from any seaman or other person

seeking employment, as seaman, or from any person on his behalf, any

remuneration whatever for providing him with employment, he shall for

every such offense be deemed guilty of a misdemeanor and shall be

imprisoned not more than six months or fined not more than $500."

SEC. 33. That section 20 of such Act of March 4, 1915, be, and is,

amended to read as follows:

"SEC. 20. That any seaman who shall suffer personal injury in the course

of his employment may, at his election, maintain an action for damages

at law, with the right of trial by jury, and in such action all statutes

of the United States modifying or extending the common-law right or

remedy in cases of personal injury to railway employees shall apply; and

in case of the death of any seaman as a result of any such personal

injury the personal representative of such seaman may maintain an action

for damages at law with the right of trial by jury, and in such action

all statutes of the United States conferring or regulating the right of

action for death in the case of railway employees shall be applicable.

Jurisdiction in such actions shall be under the court of the district in

which the defendant employer resides or in which his principal office is

located."

SEC. 34. That in the judgment of Congress, articles or provisions in

treaties or conventions to which the United States is a party, which

restrict the right of the United States to impose discriminating customs

duties on imports entering the United States in foreign vessels and in

vessels of the United States, and which also restrict the right of the

United States to impose discriminatory tonnage dues on foreign vessels

and on vessels of the United States entering the United States should be

terminated, and the President is hereby authorized and directed within

ninety days after this Act becomes law to give notice to the several

Governments, respectively, parties to such treaties or conventions, that

so much thereof as imposes any such restriction on the United States

will terminate on the expiration of such periods as may be required for

the giving of such notice by the provisions of such treaties or

conventions.

SEC. 35. That the power and authority vested in the board by this Act,

except as herein otherwise specifically provided, may be exercised

directly by the board, or by it through the United States Shipping Board

Emergency Fleet Corporation.

SEC. 36. That if any provision of this Act is declared unconstitutional

or the application of any provision to certain circumstances be held

invalid, the remainder of the Act and the application of such provisions

to circumstances other than those as to which it is held invalid shall

not be affected thereby.

SEC. 37. That when used in this Act, unless the context otherwise

requires, the terms "person," "vessel," "documented under the laws of

the United States," and "citizen of the United States" shall have the

meaning assigned to them by sections 1 and 2 of the "Shipping Act,

1916," as amended by this Act; the term "board" means the United States

Shipping Board; and the term "alien" means any person not a citizen of

the United States.

SEC. 38. That section 2 of the Shipping Act, 1916, is amended to read as

follows:

"SEC. 2. (a) That within the meaning of this Act no corporation,

partnership, or association shall be deemed a citizen of the United

States unless the controlling interest therein is owned by citizens of

the United States, and, in the case of a corporation, unless its

president and managing directors are citizens of the United States and

the corporation itself is organized under the laws of the United States

or of a State, Territory, District, or possession thereof, but in the

case of a corporation, association, or partnership operating any vessel

in the coastwise trade the amount of interest required to be owned by

citizens of the United States shall be 75 per centum.

"(b) The controlling interest in a corporation shall not be deemed to be

owned by citizens of the United States (a) if the title to a majority of

the stock thereof is not vested in such citizens free from any trust or

fiduciary obligation in favor of any person not a citizen of the United

States; or (b) if the majority of the voting power in such corporations

is not vested in citizens of the United States; or (c) if through any

contract or understanding it is so arranged that the majority of the

voting power may be exercised, directly or indirectly, in behalf of any

person who is not a citizen of the United States; or (d) if by any other

means whatsoever control of the corporation is conferred upon or

permitted to be exercised by any person who is not a citizen of the

United States.

"(c) Seventy-five per centum of the interest in a corporation shall not

be deemed to be owned by citizens of the United States (a) if the title

to 75 per centum of its stock is not vested in such citizens free from

any trust or fiduciary obligation in favor of any person not a citizen

of the United States; or (b) if 75 per centum of the voting power in

such corporations is not vested in citizens of the United States; or (c)

if, through any contract or understanding it is so arranged that more

than 25 per centum of the voting power in such corporation may be

exercised, directly or indirectly, in behalf of any person who is not a

citizen of the United States; or (d) if by any other means whatsoever

control of any interest in the corporation in excess of 25 per centum is

conferred upon or permitted to be exercised by any person who is not a

citizen of the United States.

"(d) The provisions of this Act shall apply to receivers and trustees of

all persons to whom the Act applies, and to the successors or assignees

of such persons."

SEC. 39. That this Act may be cited as the Merchant Marine Act, 1920.

Approved June 5, 1920.

[34] Public, No. 261, 66th Congress.

An Act to provide for the promotion and maintenance of the American

merchant marine, to repeal certain emergency legislation, and provide

for the disposition, regulation, and use of property acquired

thereunder, and for other purposes.

APPENDIX III

PROTEST

The following is a specimen of a marine protest. It is taken from

Lawrence _v._ Minturn, 17 How. 100. It was signed by all the officers

and by such of the crew as could write:

August 29, 1851, Latitude 31° 0´ N., Longitude 61° 5´ W.

At sea, on board ship _Hornet_ of New York, William W. Lawrence,

master, bound from New York to San Francisco, California.

We, the undersigned, master, officers and mariners of the ship _Hornet_,

of New York, do, after mature and serious deliberation, enter this

solemn protest: That on August 26th, 1851, the ship _Hornet_ being then

in or about the longitude of 49° W., latitude 37° N., experiencing a

gale of wind from the south, veering to N. W.: and that during said

gale, which lasted until the night of the 27th of August, the weight of

the deck load, consisting of two boilers, with furnaces attached, and

two steam chimneys (the whole supposed to be of the weight of forty tons

or thereabouts), did cause the ship to labor very hard, rolling gunwale

deep, shipping large bodies of water, straining the ship in her upper

works and decks, causing the ship to leak badly, and her pumps

constantly worked, placing our lives, ship and cargo in imminent peril

for their safety. We now, therefore, do most seriously and solemnly

assert, that for the future preservation of the ship, and thereby our

lives and cargo, the said boilers, furnaces and chimneys are unsafe on

the decks, and for the safety of the whole should be thrown overboard as

soon as possible, the weather and sea permitting.

In testimony whereof to the above, we hereby subscribe our respective

names.

TABLE OF CASES

PAGE

Aguan, 48 Fed. 320 53

Albany, The, 44 Fed. 431 46, 188, 206

Albert Dumois, 177 U. S. 240 151

Albina Ferry Co. _v._ Imperial and S. G. Reed, 38 Fed. 614 167

Allanwilde Transport Corp. _v._ Vacuum Co., 248 U. S. 377 90

Ambrose Light, 25 Fed. 408 199

Amelie, 6 Wall. (U. S.) 18 20, 50

America. _See_ Eads _v._ Brazelton, 22 Ark. 499 208

America. _See_ Gracie _v._ Palmer, 8 Wheat. (U. S.) 605 95

American Sugar Refining Co. _v._ Maddock, 93 Fed. 980 42

Ancaios, 170 Fed. 106 53

Anderson _v._ Munson, 104 Fed. 913 102

Arcturus, 17 Fed. 95 44

Atlantic, 53 Fed. 607 41, 129

Atlas, 3 Otto (U. S.) 302 152

Atlee _v._ Union Packet Co., 21 Wall. (U. S.) 389 148, 215

Attorney General's Opinion, 29 Op. 188 27

Aurora, 1 Wheat. (U. S.) 96 50, 140

Australasian Steam Navigation Co. _v._ Morse, L. R. 4 P. S. 222,

1 Aspin. 407, 27 LT. Rep. N. S. 357, 8 Moore P. C. N. S. 482,

20 Weekly Rep. 728, 17 Eng. Reprint 393 47

Barker _v._ The Swallow, 44 Fed. 771 73

Barnard _v._ Adams, 10 How. (U. S.) 270 189

Barnstable, 181 U. S. 464 33, 104

Behrens _v._ Furnessia, 35 Fed. 798 82

Belden _v._ Chase, 150 U. S. 674 150

Belfast, 7 Wall. (U. S.) 624 4

Belgenland, 114 U. S. 355 158

Benefactor, 103 U. S. 247 124

Blake, 107 U. S. 418 147

Bold Buccleugh, The, 7 Moore P. C. 267 130

Boskenna Bay, 36 Fed. 697 110

Boston, The, Blatch & H. 309 40

Bowring _v._ Thebaud, 56 Fed. 520 87

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