mercial Bank v. Pfeiffer, 108 N. Y. 242. See also Calkins v. Bump, 120 Mich. 335, 342; Rafferty v. Bank of Jersey City, 33 N. J. L. 368. And there are a few decisions the result of which necessarily involves the proposition that one who has contracted with the associates as a corporation is always estopped to defend on the ground that the associates were not authorized to act as a corporation. Blake v. Holley, 14 Ind. 383; Meikel v. German Soc., 16 Ind. 181; Hasselman v. U. S. Mortgage Co., 97 Ind. 365; Liverpool Co. v. Hunt, 11 La. Ann. 623; Franz v. Teutonia Ass'n, 24 Md. 259 (but see Boyce v. Church, 46 Md. 359); Farmers Co. v. Needles, 52 Mo. 17; Nat'l Ins. Co. v. Bowman, 60 Mo. 252; Studebaker Co. v. Montgomery, 74 M0. 101.

Where the associates are acting under color of right, it is submitted that they should be permitted to sue, as a corporation, for a tort done to their property. See 20 HARV. L. REV. 469–71, and notes 24 and 25. This question has never received careful consideration by the courts. In Am. Trust Co. v. Minnesota Co., 157 Ill. 641, there is a dictum that the associates could not maintain any action, on the ground that there was no law under which such a corporation could have been legally formed.

Where the corporation de facto is not a party to the suit, and the only question is whether it might be a conduit of title, it is submitted that, if the associates were acting under color of right, their grantee or vendee should be protected. See 20 HARV. L. REV. 457, and note 2. This question has never received careful consideration by the courts. In Am. Trust Co. v. Minnesota Co., 157 Ill. 641 (no law), and Bradley v. Reppell, 133 Mo. 545 (expiration of charter), the grantee was not protected. But the language in Smith v. Sheeley, 12 Wall. (U. S.) 358, would support the opposite conclusion. See also Sherwood v. Alvis, 83 Ala. 115, 118; Brickley v. Edwards, 131 Ind. 3, 7; Reynolds v. Myers, 51 Vt. 444, 445; County of Leavenworth v. Barnes, 94 U. S. 70.

Where the associates are sued as a corporation, the courts are very slow to permit them to set up their lack of authority to act as a corporation. See McDonnell v. Alabama Ins. Co., 85 Ala. 401 (no law); Racine Co. v. Farmers' Trust Co., 49 Ill. 331, 344 (no law); McCarthy v. Lavasche, 89 Ill. 270 (no law); Dows v. Naper, 91 Ill. 44 (no law); Shadford v. Detroit Ry., 130 Mich. 300 (no law); Gardner v. Minneapolis Co., 73 Minn. 517 (no law); Latimer v. Bard, 76 Fed. 536 (fraud); Miller v. Coal Co., 31 W. Va. 836 (charter expired; tort to employee. Cf. Knights of Pythias v. Weller, 93 Va. 605); U. S. Express Co. v. Bedbury, 34 Ill. 459 (naked assumption); Johnson v. Corser, 34 Minn. 355, 358 (naked assumption); Perine v. Grand Lodge, 48 Minn. 82 (naked assumption); Corey & Co. v. Morrill, 61 Vt. 598 (naked assumption). See also Dooley v. Cheshire Glass Co., 15 Gray (Mass.) 404; Hassinger v. Ammon, 160 Pa. St. 245; Casey v. Galli, 94 U. S. 673. Cf. Pittsburg Co. v. Beale, 204 Pa. St. 85.

.

THE CONFUSION IN THE LAW RELATING TO MATERIALMEN'S LIENS ON VESSELS.

A

LTHOUGH the administration of the maritime law of the

United States might, in many particulars, be bettered by a codification, no branch of that law is in more urgent need of legislative amendment than is the law relating to materialmen's liens. It is the purpose of this article to discuss some features of the confusion which exists at present in that division of the maritime law, and to point out the remedy therefor.

The difficulties and anomalies which have arisen can be traced for the most part to three cases decided by the Supreme Court of the United States.

In the first of these cases, The General Smith, the Supreme Court reversed a decree in rem for supplies furnished a vessel in her home port. Mr. Justice Story explained the decision by saying that although the maritime law gave a lien for necessaries furnished to a foreign ship or to a ship in a port of the state to which she did not belong, the case was governed altogether by the state law when the necessaries were furnished in the port or the state to which the ship belonged. Inasmuch as in this case the common law of the state in which the owner lived provided no lien under the circumstances, the materialman's claim was denied. The distinction between "foreign" and "domestic" vessels, as these terms are now understood, arose as a result of this decision.

Five years later, in The St. Jago de Cuba, Mr. Justice Johnson declared (1) that it was not in the power of any one except the master to give implied liens on a vessel; and (2) that when the owner is present "the contract is inferred to be with the owner himself on his ordinary responsibility, without a view to the vessel as the fund from which compensation is to be derived." The doctrine of presumption of credit to the owner was thereby established in the law. Whether this was an original view 3 or merely

3 In Wilkins v. Carmichael, Dougl. 101, Lord Mansfield remarked: “Work done for a ship in England is supposed to be on the personal credit of the employer. In foreign parts the master may hypothecate the ship." Cf. The Albany, 4 Dill. (U. S. C. C.) 439, 441.

a deduction made from the decision in The General Smith, or whether it was in fact the theory of the court in that historic case, we do not undertake to decide.1 In any event Judge Story was a member of the bench when the later case was decided and recorded no dissent from the law as expressed by his associate.

Finally in 1857 the same court held, in People's Ferry Co. v. Beers,2 that a contract for the construction of a vessel is not maritime because neither made nor to be performed on the water, and hence is not within the jurisdiction of the admiralty courts.

It is generally conceded that the division of vessels into foreign and domestic ships in the matter of materialmen's liens was not only artificial, but contrary to the law of maritime Europe.3 Furthermore it was not in accord with the theory of the English law. The English admiralty did not deny the right of the materialman to proceed in rem. The court was simply not permitted to entertain or enforce a lien for supplies or repairs furnished within the country. The reason for Mr. Justice Story's error is largely, if not wholly, a matter of conjecture. But although the vice in his law has been made abundantly evident by the difficulties which have arisen in carrying it into effect, the doctrine of The General Smith has been steadfastly adhered to by the Supreme Court.6

4

1 Cf. Johnson, J., in Woodruff v. The Levi Dearborne, Fed. Cas. No. 17988 (1811). 2 20 How. (U. S.) 393.

See Benedict, The Am. Adm., 3 ed., §§ 272, 273. As expressed by Mr. Justice Brown in a recent case, the ruling in The General Smith was "a distinct departure from the continental system, which makes no account of the domicil of the vessel, and is a relic of the prohibitions of Westminster Hall against the Court of Admiralty." The Roanoke, 189 U. S. 185, 194.

4 See Longyear, J., in The Champion, Brown Adm. (U. S. D. C.) 520, 531; The Zodiac, 1 Hagg. Adm. 320, 325; 2 Parsons, Shipp. & Adm., 322. In The Underwriter, 119 Fed. 713, 740, 742, Judge F. C. Lowell characterizes the error of Mr. Justice Story as due to the failure to perceive clearly the "difference between jurisdiction and substantive law."

5 See The Brig Nestor, I Sumn. (U. S. C. C.) 73, 74, 79, decided by Judge Story in 1831; and compare Mr. Justice Johnson's insinuation in Ramsey v. Allegre, 12 Wheat. (U. S.) 611, 614, 636.

• The Roanoke, 189 U. S. 185. With one notable dissent by Mr. Justice Clifford in The Lottawanna, 21 Wall. (U. S.) 558, 583, Field, J., concurring. In 1858, by amendment of the 12th Admiralty Rule, the right of the materialman to proceed in rem in the case of domestic vessels was taken away, and Chief Justice Taney explained the alteration as due to the fact that the previous practice authorizing such procedure was found to be inapplicable to our mixed form of government, saying in The St. Lawrence, Black (U. S.) 522, 530-1: "If the process in rem is used wherever the local law gives the lien, it will subject the admiralty court to the necessity of examin

The decision in Ferry Co. v. Beers was quite as much in conflict with the best practice of continental Europe as was the opinion in The General Smith, and it has been criticized accordingly. Nevertheless the Supreme Court has just refused to modify its first ruling.2

While less fault has been found with the expressions in The St. Jago de Cuba, they are equally objectionable, and it is evident, from a study of the lien law of the country in its present state, that the effect of the case has been no less fatal than that of The General Smith. Neither of Mr. Justice Johnson's statements— that when the owner is present the contract is assumed to be made on his individual responsibility, and that only the master can impress the vessel with an implied lien-seems to be duplicated under the continental system, at least in the law of France. The older continental codes are far from explicit on the subject of materialmen's liens. Indeed we sometimes wonder whether modern jurists have exactly interpreted the old sea laws in this particular.3 Generally speaking, such articles as are contained in them deal with "express" rather than with what we now term "implied" liens.*

ing and expounding the varying lien laws of every state, and of carrying them into execution." This is precisely what has happened, and it is not difficult to agree with the learned judge that such duties "are entirely alien to the purposes for which the admiralty power was created." Furthermore, it has not always been easy to determine in just what instances the local laws are applicable, in other words to decide when the vessel must be said to be "domestic" and when "foreign." And this is an important consideration, for if the materialman proceed upon the wrong theory in the first instance he may be precluded after an adjudication from taking the proper steps. See The New Brunswick, 125 Fed. 567. The wonder is that the Supreme Court, instead of attempting to dodge the issue, did not overrule The General Smith at the first opportunity. The St. Lawrence was before the court in 1861, and in 1874, after the 12th Rule had been restored to its original compass, a splendid chance was lost with the decision in The Lottawanna.

1 Consulato del Mare, c. 32; 2 Boucher's translation, 38 (1808); Cleirac, Us et Coutumes de la Mer, 1661 ed., 419; Ordonnance de la Marine, Liv. 1, t. XIV, Art. XVII; I Valin, Com., 113, 367; 2 Émérigon, Traité des Assurances et des Contrats a la Grosse, Boulay-Paty ed., c. XII, § 111; Code de Commerce, Art. 191; 1 BoulayPaty, de Droit Com. Mar., 121-2; Goirand, French Commercial Law, 2 ed. (1898), 250, 594; Benedict, Adm., § 264.

2 The Winnebago, 205 U. S. 354 (April 8, 1907).

8 Thus, while it is stated by Mr. Justice Curtis in The Young Mechanic, 2 Curt. (U. S. C. C.) 404, 408, that “privileged hypothecations were tacitly conferred " under the general maritime law of Europe "in cases in which what we term liens now exist" the learned judge admits that "we do not find their precise nature described in any of the ancient collections of sea laws."

4 But note The Consulato, c. 34, 2 Boucher, 40. And see Cleirac, 1661 ed., 401, 419; Benedict, Adm., 144.

The Marine Ordinance of Louis XIV, however, which has been regarded as largely a codification of the law then existing, and especially the modern French code, enumerate specifically the nature and rank of privileged claims, including the claims of materialmen. Under those provisions both the place where the contract is made and the position of the person ordering the necessaries appear to be immaterial, provided such person has the requisite authority. No presumption of individual credit arises. with the owner's presence. Moreover, an agreement by a prospective owner for the construction of a ship gives rise to a privileged claim on the res without further stipulation, and his order2 or authorization seems to be essential to create a lien for supplies and repairs to the completed vessel at his place of residence. From the earliest times the continental law has placed restrictions on the authority of the master when at the place where the owner lives.* And under the Code de Commerce the master, when at the place of residence of the owners or their agents, cannot furnish his vessel without "special" authorization. In a sense, therefore, the presence of the owner under the French law does affect the existence of a lien for necessaries, but not as it does in this country. Instead of being the person who alone can impress the ship with an implied lien, the French master, generally speaking, can do so of his own right only when away from the owners. When the owner has absented himself without delegating his powers to any one, the master is assumed to be authorized to provide what he deems necessary for the vessel. And we are told by M. Boulay-Paty that the debt is privileged when the master has supplied the ship at the owner's home without special authority, if he was charged with the duty of equipping and repairing the vessel. If there are

1 See Ordonnance de la Marine (1681), Liv. 1, t. XIV, Arts. XVI, XVII; 1 Valin, 362, 367; Code de Commerce, Art. 191; 1 Boulay-Paty, 110, 121; 1 Cresp., de Droit Mar., 104 et seq.; Goirand, 250, 593-4; 3 Kent, Comm., 14 ed., *169, n. a.

2 See the case "Havre," 19 Rev. Internat. du Droit Mar. 61 (1903).

3 In the construction of a vessel it has been said that if the owner enter into an engagement with an independent contractor to build the ship for a lump sum, the workmen of the latter have no personal claim against the owner, but against the res only. The contractor alone has a double claim against both ship and owner. 2 Pardessus, Cours de Droit Com., 6 ed., de Roziere, § 943; and see § 954

4 Consulato del Mare, c. 239; 2 Boucher, 388; Laws of the Hanse Towns, Arts III and IV; Cleirac, 197; Ordonnance de la Marine, Liv. ii, t. I, Art. XVII; 1 Valin, 439; 2 Émérigon, 450 et seq.; 2 Pouget, de Droit Mar., 237 and 251.

Art. 232; 2 Boulay-Paty, 51-2; Goirand, 263, 602. 62 Pardessus, § 630.

7

I Droit Com. Mar., 122.