Charter Shipping Co. v. Bowring, Jones & Tidy, Ltd.

Background

A British shipping company sued another British shipping company in the federal court in southern New York to recover a general average deposit paid in London. The complaint says the defendant’s ship received cargo at several U.S. ports for carriage to London and that a general average contribution was paid because the vessel was unseaworthy at voyage start, unknown to the depositor. After this U.S. suit began, the complainant also started a related suit in England.

Reasoning

The central question was whether the U.S. district judge abused his discretion in dismissing the admiralty suit and leaving the parties to the English proceedings. The Court explained that general average liability usually is governed by the law at the port of destination and that the rule can be altered by clauses in the bills of lading, but the bills were not in the record so their terms could not be assessed. Because both parties were British, the fund was located in England, witnesses and ship officers appeared likely to be available there, and the district judge considered convenience and fairness, the judge did not act improvidently in declining to take the case.

Real world impact

The decision confirms that U.S. admiralty judges may refuse to hear disputes between foreigners when justice can be equally served in a home forum, especially where governing documents and key witnesses are abroad. This ruling resolves a procedural question about where such shipping disputes should be decided, not the underlying merits of the general average claim.