Rehearing Denied May 13, 1985.
See 471 U.S. 1112.
On petition for writ of certiorari to the United States Court of
Appeals for the Second Circuit.
The petition for a writ of certiorari is denied.
Justice BLACKMUN, with whom Justice MARSHALL joins,
dissenting.
The admiralty jurisdiction of the federal courts extends
generally to a transaction that " 'relates to ships and vessels,
masters and mariners, as the agents of commerce.' " Kossick v.
United Fruit Co.,
365 U.S.
731, 736, 890 (1961), quoting 1 E. Benedict, Admiralty 131 (6th
ed.1940). Notwithstanding the broad sweep of the admiralty
jurisdiction, this Court, since the time of its single-page opinion
in Minturn v. Maynard, 17 How. 477 (1855), has refused to extend
admiralty jurisdiction to disputes involving general agency
contracts that call for "husbanding" a vessel, that is, arranging
for the performance of the various services that are preliminary to
maritime movement. This case presents an opportunity to address the
continued vitality of this much-criticized exception to admiralty
jurisdiction, an exception that has been
Page 470 U.S.
1031 , 1032
applied inconsistently and that has created unnecessary
confusion in the federal courts.
Justice BRENNAN would grant certiorari.
Petitioner Peralta is the general agent in the United States for
an operator of several oceangoing cargo vessels. In 1979, it
executed a sub- agency agreement with respondent Smith &
Johnson whereby it appointed respondent as "Gulf agents"
responsible for arranging services for the principal's vessels
calling on ports between Brownsville, Tex., and Tampa, Fla. Under
the agreement, respondent promised to act as the "husbanding
agen[t]" by providing for services such as
"arranging for entrance and clearance
of vessels at the Custom House, execution of all Custom House
documents incidental thereto, arranging for fuel, water,
provisions, emergency repairs, port charges and other similar
matters, and for stevedoring, storage and other cargo handling;
arranging for tugs,"
and a number of other services directly involved with the
operation of vessels while at port preparing for departure. See
739 F.2d
798, 799 ( CA2 1984).
Two years after the agreement was signed, petitioner commenced
this action in the United States District Court for the Southern
District of New York. Relying on the court's admiralty
jurisdiction, petitioner alleged that respondent had breached the
agency agreement. It sought an accounting and recovery of money
said to have been wrongfully retained by respondent. In particular,
Peralta sought to recover freight collected on vessels and not
turned over to it, and money advanced by petitioner to pay
suppliers but diverted by respondent. Addressing cross-motions for
summary judgment, the District Court on its own questioned its
subject- matter jurisdiction. It concluded that the sub-agency
"husbanding" contract under which respondent acted as local port
agent for the principal was not a maritime contract within the
court's admiralty jurisdiction. It therefore dismissed the
complaint pursuant to Federal Rule of Civil Procedure 12(h)(3).
The Court of Appeals affirmed,
739 F.2d
798 (CA2 1984), holding that it was constrained by Minturn,
supra, and those Second Circuit cases that had faithfully adhered
to the rule established in Minturn that admiralty jurisdiction does
not extend to general agency or sub-agency "husbanding" contracts.
739 F.2d, at
Page 470 U.S.
1031 , 1033
802-803. The court declined to narrow the scope of Minturn by
finding an exception for husbanding sub-agency contracts that
provide services necessary for the continuing voyage, rather than
services preliminary to the voyage, though it recognized that the
Ninth Circuit had taken this approach in Hinkins Steamship Agency
v. Freighters, Inc.,
351 F.
Supp. 373 ( ND Cal.1972), aff'd,
498 F.2d
411 (1974). See 739 F.2d, at 803-804. Finally, the court
recognized that the Minturn rule made little sense in light of the
policy concerns underlying the grant of admiralty jurisdiction-the
federal interest in promoting and protecting the maritime industry.
See 739 F.2d, at 804. Though it "would welcome" a decision from
this Court overruling Minturn, because agency and sub-agency
agreements are clearly an integral part of maritime commerce, and
thus should be included within the admiralty jurisdiction, it
recognized that it was without authority to issue such a decision,
and that " 'only the Supreme Court should do it,' " quoting Admiral
Oriental Line v. Atlantic Gulf & Oriental S.S. Co., 88 F.2d 26,
27 (CA2 1937). See 739 F.2d, at 804.
"The boundaries of admiralty
jurisdiction over contracts-as opposed to torts or crimes-being
conceptual rather than spatial, have always been difficult to
draw." Kossick v. United Fruit Co., 365 U.S., at 735, 81 S. Ct., at
890. Generally, however, contract actions that relate to maritime
service or maritime transactions have been understood to fall
within the admiralty jurisdiction of the federal courts. Though the
need for bright- line rules in this area is evident, the line drawn
in Minturn has been criticized widely and severely because it
excludes so much that obviously concerns maritime transactions.
Thus G. Gilmore & C. Black, Law of Admiralty 28, and n. 94b (2d
ed. 1975), regard the rule as one of "dubious defensibility," and
have predicted that, when this Court reaches the issue, it will
hold that general agency and other vessel-management agreements
fall within the admiralty jurisdiction, and will overrule Minturn
and its progeny. See also 7A J. Moore & A. Pelaez, Moore's
Federal Practice . 250, p. 3006 (1983) ("Quite clearly, such
agreements are an integral part of, and in furtherance of, maritime
commerce and, consequently, should be cognizable within the
admiralty jurisdiction of the district courts").
Not only is the Minturn rule of dubious validity, but in efforts
to narrow its application, the Courts of Appeals have developed a
number of equally questionable exceptions to the rule that have
Page 470 U.S.
1031 , 1034
created confusion and disagreement. Thus, for purposes of
determining admiralty jurisdiction, the Ninth Circuit would
distinguish among maritime agency contracts based on a series of
factors, including the degree of importance of the services
rendered by the agent, the extent of supervision of performance,
and the existence of a continuing relationship between agent and
principal. Hinkins, supra. The Fifth Circuit appears to have taken
the position that Minturn applies only to an action for an
accounting. See Hadjipateras v. Pacifica, S.A.,
290 F.2d
697, 704, and n. 15 (1961).* The Second Circuit in the present
case recognized that its decision was in conflict with these
decisions of the Fifth and Ninth Circuits. See 739 F.2d, at 803,
and n. 4.
The conflict between the approaches to this question taken by
the Courts of Appeals is reason enough to grant this petition, for
uniformity and predictability in the maritime industry were the
ends sought in the Constitution when federal-court maritime
jurisdiction was created in the first instance. A substantial
argument has been advanced that the rule established in Minturn
improperly excludes from federal maritime jurisdiction disputes
that directly concern the business of maritime commerce. In light
of the strength of that argument, of the confusion and conflict in
the courts, and of the need for a uniform rule, I would grant this
petition.
I therefore dissent.
Justice POWELL took no part in the consideration or decision of
this petition.
Footnotes
[
Footnote *] " [T]he distinctions
made by the courts in dealing with agreements with brokers and
agents seem contrived and not based upon sound reason or policy."
7A J. Moore & A. Pelaez, Moore's Federal Practice .250, p. 3003
(1983).
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