States, and it always has been, a private carrier can contract against his own negligence. The limitation upon the right of contract only applies to the common carriers. If I understand section 6, the effect of it is to make the carrier, to change his character from a common carrier to that of a special carrier or private carrier. Let us see:

Notwithstanding the provisions of the preceding sections, a carrier, master, or agent of the carrier, and a shipper shall, in regard to any particular goods be at liberty to enter into any agreement in any terms as to the responsibility and liability of the carrier for such goods, and as to the rights and immunities of the carrier in respect of such goods, or his obligation as to seaworthiness (so far as the stipulation regarding seaworthiness is not contrary to public policy), or the care or diligence of his servants or agents in regard to the loading, handling, stowage, carriage, custody, care, and discharge of the goods carried by sea: Provided, That in this case no bill of lading has been or shall be issued and that the terms agreed shall be embodied in a receipt which shall be a nonnegotiable document and shall be marked as such.

That is practically the same thing as saying that where only a charter party is entered into between shipper and shipowner, and there is no bill of lading which becomes negotiable so that title can pass of a negotiable instrument constituting practically the relation of shipper and private carrier in respect of those particular goods, then that the shipowner may make this special contract. That is what he can do to-day under the law to-day.

Mr. DAVIS. Yes; but you want to make it legal. In other words, suppose a man goes to ship something and instead of delivering him a bill of lading they deliver him a receipt that has a lot of fine print in it waiving the liability of the carrier with respect to all the matters enumerated in section 6.

Mr. CAMPBELL. Yes.

Mr. DAVIS. Then if the shipper accepts this receipt which may be in substantially the same general form as a bill of lading, and there is not one shipper out of ten thousand that reads the bill of lading or his receipt either, he will accept that in good faith and never know any different, until trouble comes, and then they will say, "You waived all that."

Mr. DRAPER. Mr. Campbell, as he explained, has not had full opportunity to study all the provisions of this bill, and I think it might be enlightening if both of you gentlemen will look to title 2 on page 12, section 10, and observe closely the language that is used there, which relates back to the section that we are discussing.

Mr. DAVIS. I have read it all very carefully last night and compared it with existing law.

Mr. CAMPBELL. Let me say this. Supposing that you were a large shipper and you had enough goods of a certain kind to go out and charter a ship by yourself, you go and charter this vessel and you can to-day make any kind of a contract you please with respect to the charter so long as there are no negotiable bills of lading issued which will pass through the hands of third parties. Why should not the same principle apply to any ship that you leave freedom of contract between the shipper and ship owner, as to the terms of the carriage, provided that that opportunity exists to everybody, and provided that there is no document issued which can pass into the hands of any innocent person so that any harm can be done to the innocent one? The two people will know what they are doing.

Mr. DAVIS. But section 6 does not merely deal with charter parties. The second paragraph of section 5 provides:

The provisions of this act shall not be applicable to charter parties, but if bills of lading are issued in the case of a ship under a charter party, they shall comply with the terms of this act.

Mr. CAMPBELL. Those are two different provisions.

Mr. DAVIS. That section applies to charter parties and section 6 refers to any shipments as to which a receipt is given as therein permitted.

STATEMENT OF CHAUNCEY G. PARKER, GENERAL COUNSEL, UNITED STATES SHIPPING BOARD

Mr. PARKER. Is not Judge Davis right about that, that this provision about receipts applies to the cargo which may be shipped by a common carrier?

Mr. CAMPBELL. That is right.

Mr. PARKER. Especially shipments of a peculiar character.
Mr. CAMPBELL. That is what I say.

Mr. DAVIS. But it uses the language, in regard to any particular goods.

Mr. PARKER. I think you are right. There is an illustration of that that may be helpful, which you may know about. We have this old case where cocoanut oil was shipped from the Philippines in deep tanks, where there is an agreement as to deep tanks and the ship being surveyed by particular surveyors. There was an agreement between the shipper and the carrier that the survey of the particular surveyors as to the seaworthiness and the propriety of deep tanks should be binding upon both parties, and it turned out afterwards that there was a defect in the deep tank, so that the fuel oil got into the cocoanut oil that was loaded in the deep tank, and the result was that the cocoanut oil was spoiled. Then the shipper took the view that this agreement made between the shipper and the carrier was unreasonable because it was in the bill of lading, and the court so held and the matter is now before the circuit court of appeals to be argued. It seems to me that this particular provision has to do with an illustration like that.

Mr. DAVIS. And legalizes a bill of lading that has such a provision in it.

Mr. PARKER. No; it permits the shipper to make shipments, which otherwise the carrier would be unwilling to receive.

Mr. CAMPBELL. That is right.

Mr. PARKER. They may make a special agreement with reference to the particular cargo on the vessel, so that it is really for the benefit of the shipper because he gets the goods shipped, otherwise the carrier will say, "No, sir; I will not take the coconut oil because the risk is too great.'

Mr. DAVIS. You stated a particular case. This permits an exception in any case.

Mr. CAMPBELL. This permits a common carrier to become a private carrier with respect to a particular shipment, provided that bills of lading are not issued.

Mr. PARKER. By way of a receipt or special contract.

Mr. DAVIS. You can take it that way if you want to, but this provision permits any sort of deviation by agreement from the general form of the bill of lading provided in this act.

Mr. CAMPBELL. No. You go too far in that.

Mr. DAVIS. That is the purpose of it and will be the effect of it. Mr. CAMPBELL. No. This bill largely pertains to bills of lading, but in a case where no bill of lading is issued, it provides that a private carrier status can be established.

Mr. ABERNETHY. Why should there be a bill of lading of that kind? If you are going to have a uniform bill of lading, why should there be another form where a bill of lading is not issued?

Mr. CAMPBELL. As in the case of the coconut oil, there may be a shipment of such a character that the shipowner will not take it subject to the liability as a common carrier because of the dangerous character of the cargo, but would take it as a private carrier if it could be taken under certain limited risks.

Mr. PARKER. Take the ice clause in the North Sea and the Baltic Sea, used by the McCormick people. They are very stringent against the shipper. But, of course, that is a peculiar trade with peculiar risks. The clauses are to the effect that if the vessel is detained by ice, that the owner of the vessel and the vessel may have all kinds of privileges with reference to diverting the cargo, and so forth.

Mr. ABERNETHY. But if we are going to make a uniform bill of lading, why should we not write it in the law rather than leave it to the shipper and the carrier to put it on the margin, one side or the other? That seems to be the thing?

Mr. CAMPBELL. This would not apply to the bill of lading. says where no bill of lading is issued.

This

Mr. ABERNETHY. If we are going to have a uniform bill of lading, why not require it in all instances?

Mr. PARKER. Is not the object of this law to say that if a shipment is made by a bill of lading, then it must be uniform and must comply with the act, but if the shipment is intended to be made in any other way, then it must be made by special agreement.

Mr. ABERNETHY. What is the use of having a bill of lading, uniform bills of lading, if you are not going to have the language so worded? A railroad can not ship except by bills of lading.

Mr. CAMPBELL. A railroad is only a common carrier. a private carrier. You can not use a charter.

It never is

Mr. PARKER. I think you are right. I think Mr. Haight yesterday emphasized, and Mr. Campbell will also emphasize that the practice of carriage by sea is entirely different than it is by land.

Mr. DAVIS. Let us take up this bill of lading and compare the actual changes in the law. On top of page 3, section 3, it says:

The carrier shall be bound, before and at the beginning of the voyage, to exercise due diligence to

(a) Make the ship seaworthy.

The

The language used in the Harter Act is to make the ship in all respects seaworthy. The words, in all respects, are omitted. language of the Harter Act is changed so as to get away from the interpretation of the Harter Act by the Supreme Court to the effect that the seaworthiness of the vessel is warranted by the owner, is it not?

Mr. CAMPBELL. I do not think that is any different than the Harter Act to-day. Look at section 2 of the Harter Act.

Mr. DAVIS (reading):

That it shall not be lawful for any vessel transporting merchandise or property from or between ports of the United States of America and foreign ports, her owner, master, agent, or manager, to insert in any bill of lading or shipping document any covenant or agreement whereby the obligations of the owner or owners of said vessel to exercise due diligence, properly equip, man, provision, and outfit said vessel, and to make said vessel seaworthy and capable of performing her intended voyage, or whereby the obligations of the master, officers, agents, or servants to carefully handle and stow her cargo and to care for and properly deliver same, shall in any wise be lessened, weakened, or avoided. Mr. CAMPBELL. This act does not do any more than that. Mr. DAVIS. Why change it then?

Mr. CAMPBELL. I was not the draftsman at the Brussels convention at the time this particular form was adopted. I suppose that this particular draft was a compromise of many drafts that were brought forward by those representatives of the different nations who were gathered in the convention, and they happened to use this language, and the effect of it is to create substantially the same state of law that we have in the Harter Act. For instance, every bill of lading to-day contains this provision, that if the owner exercises due diligence to make his vessel seaworthy he shall not be liable for loss resulting from unseaworthiness, and that provision has been held lawful. The owner is only required to exercise due diligence, and that is what this requires him to do. I do not think it makes any difference to say, 'seaworthy in all respects."

Mr. DAVIS. You are familiar with the interpretation of the Supreme
Court?

Mr. CAMPBELL. I do not recall all the decisions offhand.
Mr. DAVIS. I think this undoubtedly changes it.

Mr. CAMPBELL. I doubt that.

Mr. DAVIS. If it does not change it, why undertake to reframe it? Mr. CAMPBELL. Because we want uniformity. That is the principal reason why. There must be giving and taking in these drafts in order to obtain uniformity just as there must be between Mr. Draper and myself in trying to agree on something.

Mr. DAVIS. You keep referring to Mr. Draper, one shipper out of hundreds of thousands of them.

Mr. CAMPBELL. No; they represent the National Traffic League, which is a great big national organization and represents the greatest shippers in America.

Mr. DAVIS. There was no representative of the shippers at either London or the Brussels conference in which they adopted this so-called 'code, was there?

Mr. CAMPBELL. Not as representative of the shippers. That was a diplomatic conference in which the delegates represented the nations.

Mr. DAVIS. Shipowners, underwriters, and bankers were represented.

Mr. CAMPBELL. They were not represented there.

Mr. DAVIS. Even the banker was not represented?

Mr. CAMPBELL. No.

Mr. DAVIS. I thought maybe they were.

Mr. CAMPBELL. No, sir. That was a diplomatic conference.

་

Mr. DAVIS. We members are representing the public, and it is up to us to see whether or not these provisions are fair.

Mr. CAMPBELL. Surely. That is right. But that conference was a diplomatic conference, and the Secretary of State appointed Judge Hough, who was then, I believe, the presiding judge of the Circuit Court of Appeals, and certainly as disinterested a man as you could find, and as able a man as you could find, as any man in America, to go to that conference, who had dealt with years of litigation. He had with him Mr. Norman Beecher, an experienced admiralty lawyer at that time, as counsel to the Shipping Board representing the Government.

Mr. BRIGGS. Are you opposed to any legislation of this kind?
Mr. CAMPBELL. No.

Mr. DAVIS. You favor it?

Mr. CAMPBELL. I favor it. It is not as I would like to write it myself for the ship owners but I favor the bill.

Mr. BRIGGS. Why has it been nine years getting this proposition. anywhere if it is such a meritorious one? Why have not all the shippers of the United States risen up in their might and come forward with an insistent demand upon Congress to adopt legislation or the Senate to ratify a treaty which has been pending there so long, since about 1925?

SO.

Mr. CAMPBELL. I can not answer why the shippers have not done I can speak for myself, representing the American Steamship Owners Association during all those years, and it is this, that I think the ship owners are giving up far more than they are getting under the bill and it was not to our interest at present.

Mr. BRIGGS. Why do not the shippers realize that? If they are getting so many concessions under this bill and it is such a meritorious thing for them, and that it is just in a sort of altruism that the whole thing is offered? They have been spending money for nine long years trying it out and the shippers do not seem to know it is favored. How do you account for its hanging fire like that?

Mr. CAMPBELL. I do not know. We had long hearings here, and why was it not put through in the days that Mr. Edmonds was so active on the committee.

Mr. BRIGGS. That is what I am wondering. Was it not manifest that it was not quite so much in the interest of the people as it might seem or as it would seem to some?

Mr. CAMPBELL. I do not know. I never heard that suggestion. Frankly, I think the National Traffic League have been standing in their own light. I think they have laid stress upon really unimportant provisions of this bill that they could very easily have waived, or upon which we ought to have been able to reach a compromise provision which would not have hurt that line of business as carried on to-day, and I think from the broader point of view, if I had been in their position I would long since have pressed that and tried to get it through, but I represent a shipowners' association and seeing that the shipowners were giving away more than they were getting under the legislation, certainly it has not been up to me to press it.

Mr. BRIGGS. I have not gotten it into my head where they are giving away more than they are getting. It strikes me they are getting very much more than they are giving away.

Mr. CAMPBELL. I do not think so.