A collision occurred in the St. Clair river between the vessel George D. Dixon owned by the petitioner, Great Lakes Transit Corporation, and the vessel Willis L. King owned by the Interstate Steamship Company. Each owner brought a libel in admiralty against the other. The suits were consolidated. The Atlantic Mutual Insurance Company and other underwriters having paid to the petitioner, under insurance policies procured by it, the amount of cargo damage and loss which petitioner had paid to owners of the cargo carried by the Dixon, intervened and claimed the right through subrogation to recover the amount thus paid from the Interstate Steamship Company and its vessel, the King.
The District Court entered a decree adjudging both vessels at fault and that the intervening underwriters should recover from each of the vessels and their respective owners a moiety of the amounts paid and payable under the policies. The decree was affirmed by the Circuit Court of Appeals. 86 F.(2d) 740. In view of the importance of the issue, certiorari was granted, limited to the question of the correctness of the decree in directing recovery from the petitioner. March 8, 1937, 300 U.S. 650, 57 S.Ct. 512, 81 L.Ed. --.
Petitioner's contention is that the insurance policies were contracts between the underwriters and the petitioner under which the latter was entitled to be indemnified for the liability it had assumed under its bill of lading and its tariff provisions; that the underwriters were not entitled to recover back from petitioner what they had paid it in discharge of their obligation. The underwriters insist that their policies insured cargo and that their pay ments were made for cargo's benefit; that, the cargo damage and loss having been paid, they were entitled by subrogation to a decree for the full damage against the King; that as both vessels were at fault the King was entitled to contribution from the Dixon; and that the decree in avoidance of circuity had fixed the ultimate liabilities by requiring each vessel to pay a moiety.
The cargo on the Dixon was carried under uniform bills of lading, approved by the Interstate Commerce Commission, which after referring in section 9(a) to the exemptions contained in the Harter Act (46 U.S.C. § 190 et seq., 46 U.S.C.A. § 190, et seq.), provided in section 9(e) as follows:
'If the property is being carried under a tariff which provides that any carrier or carriers party thereto shall be liable for loss from perils of the sea, then as to such carrier or carriers the provisions of this section shall be modified in accordance with the tariff provisions, which shall be regarded as incorporated into the conditions of this bill of lading.'
The court below concluded, and we think rightly, that by the applicable tariffs the petitioner waived the saving clauses of the Harter Act and assumed full liability to the cargo owners for loss or damage caused by marine perils. While these tariffs were not uniform, they also either stated or fairly imported that the specified rates should include marine insurance.
The policies of insurance had the following rider, by which the underwriters agreed to insure the Great Lakes Transit Corporation, for account of whom it may concern, loss, if any, to be payable to the Great Lakes Transit Corporation or order,-
'On cargo of any kind owned by the Assured and on the assured's liability to others in respect to cargo of any kind covering same from time said Great Lakes Transit Corporation becomes responsible therefor and until its responsibility ceases, wheresoever the same may be, including risks while on docks, in and/or on cars on docks, piers, wharves, lighters and/or craft, transfers, and all land conveyances, and also to cover upon any advances made by and payment of back charges made by or due from said Assured, and upon any charges of said Assured upon any and all cargo or any portion thereof; from the time the Assured becomes responsible for such cargo including risks of trans-shipment, and under and/or on deck on board of the Assured's steamers: * *
*'Also to cover through to destination goods delivered by the Assured to other water transportation companies for shipment to destination.'