Calmar Steamship Corp. v. United States

Background

Calmar Steamship Corp. owned the steamship Portmar and chartered it to the United States for a round voyage. The Portmar was privately owned, manned by the owner's master and crew, and carried military supplies, including ammunition and gasoline, under the charter. Calmar sued the United States seeking extra charter hire and compensation for the vessel’s loss. The District Court accepted admiralty jurisdiction and awarded a small reimbursement, but the Court of Appeals reversed, holding that carrying war materiel meant the ship was not "employed as a merchant vessel."

Reasoning

The key question was whether a privately owned ship operated for the United States for hire counts as "employed as a merchant vessel" under the Suits in Admiralty Act, even when on a war mission. The Court rejected a test based solely on the cargo. It explained that prior cases relied on different statutes or on government ownership and that the language of the Act is better read to focus on the charter and operational arrangements. The Court emphasized harmony between related laws and practical predictability. Applying that approach, the Court concluded the Portmar was employed as a merchant vessel despite carrying military cargo and therefore federal admiralty jurisdiction was proper. The Court did not decide whether Calmar wins on the underlying contract claims.

Real world impact

The decision keeps claims like Calmar’s in federal admiralty court rather than forcing owners into the Court of Claims, reducing arbitrary forum shifts based only on cargo. It affects shipowners, carriers, and the Government by clarifying when district courts hear admiralty cases involving chartered vessels on military missions.