Mr. ENGLAR. The burden is always on the man who claims to be damaged, and he has to prove it happened while the goods were in the custody of the carrier.

Mr. CAMPBELL. Is it your interpretation of these rules that the burden of proof is on the consignee to show that the theft takes place while the goods are in the possession or custody of the carrier-that the theft did not take place while the goods were in

the customhouse under these rules?

Mr. ENGLAR. Unquestionably. I do not see how you can put any other possible interpretation on the rules.

Mr. CAMPBELL. I shall employ you, then, as counsel in the first case we have. Mr. HAIGHT. You can retain me, too. I agree with Mr. Englar. [Laughter.] Mr. CAMPBELL. I can not see it that way at all and certainly that was not the opinion expressed here this morning in the long talk Mr. Perlman had with Mr. Beecher, as I understood it.

Mr. PAUL. Your contention is, of course, the carrier ought not to be liable for the goods after delivery to the customhouse?

Mr. CAMPBELL. Yes.

Mr. PAUL. Now, on page 4, subsection (f), I believe the consignee has no opportunity to give any notice except within three days after delivery of the goods-that is the effect of it-because, even if it is not apparent, he is limited to three days within which to give the notice. That certainly must be the delivery of the goods to him? Mr. CAMPBELL. I should think so.

Mr. PAUL. Goods delivered to him by the custom officials, in nine times out of ten, have laid there for longer than three days; in a great many instances three days have elapsed and he has had no opportunity at all to see what is in them.

Mr. CAMPBELL. No; it says three days after delivery of the goods. That is delivery of the goods to him.

Mr. PAUL. Delivery of the goods to him.

Mr. CAMPBELL. I should so interpret it.

Mr. PAUL. After they come from the customhouse?

Mr. CAMPBELL. After they come from the customhouse.

Mr. PAUL. Suppose he gives notice, then, to the carrier; it might be five or six weeks after the carrier actually delivered them from the carrier's custody?

Mr. CAMPBELL. It might be.

Mr. PAUL. And the notice given at that date would mean little as to where the damage occurred, it seems to me.

Mr. CAMPBELL. That has been the common experience with the South American and Central American customhouses. That is where the greater part of these losses, I think, have taken place, which have given rise to so much controversy between the shippers and the shipowners.

Mr. HAIGHT. If it will help, I can say that throughout the discussions in England, from the British owner's standpoint, the reason they have always insisted that the code must be confined to from the time of loading until the time of discharge is very largely the fact that in many places they have to discharge goods and part with all possibility of watching them long before the consignee gets them, and they are not willing to assume any responsibility after they had discharged the goods, if they had to discharge them into the hands of the customhouse. These rules are certainly not intended to cover anything but from loading to discharge.

Mr. CAMPBELL. Do you not think, Mr. Haight, that there has been poor draftsmanship of the rules, because the word "delivered" was used originally in the rules, and we criticized that; that we were in doubt as to whether "delivery" meant delivery from the ship or to the consignee.

Mr. HAIGHT. And therefore they changed it.

Mr. CAMPBELL. Rule 1 is changed, but rule 6 is not.

Mr. HAIGHT. Rule 1 is changed so that

"The term 'carriage of goods' covers the period from the time when the goods are loaded on to the time they are discharged from the ship."

You can not make these rules cover any other period. And the reason "ship's tackle" and those other clauses were abandoned was because grain and oil are pumped in and coal is dumped from the chutes, and they wanted to make it clear that it was from the time it was loaded on and discharged from the ship.

The other proposition is a practical question of the application of the rules of evidence; it is not what you are going to be liable for, but how certain things are going to be proved, and you never can make a man liable under these rules for anything that happens after the stuff is discharged from the ship. He may be liable in some other way, under some other law, or some other code, but under these rules after the goods are discharged from the ship no liability can attach to him.

Mr. CAMPBELL. Then rule 6 should not read as it does. In Article III you provide that the bill of lading shall show the leading marks, number of packages or pieces,

or the quantity or weight, and the apparent order and condition of the goods, and then you put in a proviso

"Provided that no carrier, master, or agent of the carrier shall be bound to issue a bill of lading showing any description, marks, number

* *

There the word "description" came in; then the convention or the conference in London deleted the word "description." so that now the shipowner is only obligated to issue a bill of lading to show the leading marks, the number of packages or pieces, or the quantity or weight, and the apparent order and condition of the goods. All we have to put on the bill of lading is 1 box; weight 200 pounds; marked R. C. D.,” but that would be an utterly impracticable bill of lading in business. No banker would advance any funds against that kind of a bill of lading. He would want a bill of lading which said, "Containing so many dozen silk hose," or Containing silk hose," or "Containing coffee, or whatever it may be.

Mr. HAIGHT. Said to contain.

66

Mr. CAMPBELL. Said to contain, which would carry into the bill of lading, in business. that description. Now, then, when you come to section 6, Article III, of the convention, section 3, subdivision (f). of the bill, you say:

"Unless notice of loss or damage and the general nature of such loss or damage be given in writing to the carrier or his agent at the port of discharge before or at the time of the removal of the goods into the custody of the person entitled to delivery thereof under the contract of carriage, such removal shall be prima facie evidence of the delivery by the carrier of the goods as described in the bill of lading.'

Mr. HAIGHT. When you are talking about the notice to be given by the consignee, you have to make it possible for him to give a notice and he can not give a notice before the goods are delivered to him, before he gets the goods. And it is perfectly proper, I think, in the rules, to say when the consignee must give the notice and that can not possibly override the provision of the carrier's liability under the rules, per se, which begins with the loading and ends with the discharge.

Mr. CAMPBELL. Let me ask you this, then, Suppose the bill of lading said "1 box said to contain silk hose, marked R. C. D., weighing 200 pounds," and the case was discharged into the customhouse and remained for a week, and then two days after delivery from the customhouse to the consignee he opens them and finds bricks, and he gives notice: Would it be your interpretation that the shipowner would only be required to show what he had delivered to the customhouse officials?

Mr. HAIGHT. Sure.

Mr. LAWS. Sure; that he delivered the same thing he got.

Mr. CAMPBELL. What? Silk hose, or bricks?

Mr. Laws. It is perfectly well known that the transportation line, the carrier, has met any presumption against him by showing he delivered exactly what he got and in the same condition he got it. That is so well established there is not any ques

tion about it.

Mr. CAMPBELL. What would he have to show there; that he delivered silk hose to the custom officials?

Mr. Laws. That he got a package said to contain 50 boxes of hose and he delivered it in the same condition as he received it. That is a complete legal answer of any carrier to any presumption that arises against him by reason of the bill of lading. You know that, as well as I.

Mr. CAMPBELL. Suppose it did not say "said to contain," but said “contained”? Mr. Laws. If it said "contained," it makes no difference, absolutely.

Mr. CAMPBELL. Oh, no; I can not agree with you. There have been too many losses paid on that kind of a proposition.

Mr. LAWS. He shows that he delivered what he got in the condition that he received it; that is all he has to show. There is no presumption as to the interior of the package anywhere. If he says he received a barrel of eggs, taking the famous case of the barrel of eggs, where the bill of lading said the carrier received a barrel of eggs and when the barrel was opened it contained nothing but sawdust, the court said it was only presumed to contain eggs, even if the bill of lading said it contained eggs, and you meet the presumption completely by showing you delivered the barrel in the condition in which you received it.

Mr. PAUL. Would not that also involve a showing that the barrel had not been tampered with?

Mr. Laws. Yes; and also showing that the barrel had not been tampered with; that he delivered the barrel in the same condition as when, he received it. It only makes a prima facie case against him, which he can meet by showing he delivered the package in the same condition in which he received it. It applies to quantity, as well as contents. If he says he received a certain quantity and he delivered the exact quantity, and proves it, it dispels the presumption.

Mr. CAMPBELL. Not unless he inserts a qualification.

STATEMENT OF MR. FRANCIS S. LAWS ON BEHALF OF THE INSURANCE CO. OF NORTH AMERICA.

Mr. Laws. Mr. Chairman and gentlemen of the committee, I am opposed to the bill to a certain extent; that is to say, I represent the Insurance Co. of North America, which, by the way, is one of the members of the American Marine Underwriters and who did not agree to the report of which the resolution has been read, and they also say that I think there are about 150 members of that association, and at the meeting at which it was read there were some 27 present.

We agree that uniformity, in principle, in bills of lading, world-wide, is desirable. We assert, however, that correlating that, and equally important, is that some legisla-tion should be passed which would protect American shippers and their underwriters, who stand in their shoes, against vices which have become so world-wide and so pernicious that they have to be corrected.

This bill, based on these rules, is a step in advance; but there are some vices in it, both legal and otherwise, which ought not to be permitted to pass, in my opinion. The CHAIRMAN. Will you please indicate to what you refer?

Mr. LAWS. One of the worst, in my opinion, is that contained on page 1, section (b), and that is the time from which the liability of a carrier begins and when it ends. That has been discussed pro and con here a great deal. The law of transportation liability from time immemorial, as to both land and ocean, has been that the carrier is liable as a carrier from the time the goods are placed in his possession for transportation until the time, or a reasonable time after, they have arrived at destination and notice given to the consignee that they are ready for delivery. That is the law.

In rail transportation, after a good many fights, it has gotten down to the point where the liability ceases 48 hours after notice is given to the consignee that the goods are subject to his call. That is reasonable. It is wholly unreasonable that the time should be shorter than that, or on any other condition, because the goods may arrive at a place where he can not possibly get them and still be in the custody of the carrier.

So that, in my judgment, the liability of the carrier should continue until a reasonable length of time, whatever it may be, after the goods have arrived at destination and notice is given to the consignee of their arrival.

Mr. EDMONDS. Mr. Laws, that would still be covered by the Harter Act.

Mr. Laws. I am very fearful, personally, as to whether or not we are not going to have a magnificent conflict between this bill, or these rules, and the Harter Act. I think we are. It may be and I hope the Harter Act covers that gap.

Mr. EDMONDS. It certainly is intended to cover it, because we have discussed this several times, Doctor Huebner and myself, and this law does not change the Harter Act at all and, wherever the Harter Act was effective before, it would be effective now. This only affects between the time of loading on board and discharging, as I understand it, and these rules would only be in effect in that particular instance. But when you get down to the shore end of the line and the landing of the goods on shore, the Harter Act, I think, would still be in effect, or possibly the local warehousing acts might be in effect-I do not know about that.

Mr. Laws. If it is, that answers the difficulty; but I doubt very much if it will. Then I understand your position would be that that applies also between the time when you deliver the goods to the carrier for transportation and the time they are loaded on board the ship? That would be covered by the Harter Act as well? Mr. EDMONDS. At both ends of the line.

Mr. Laws. If it does, then this clause is not objectionable. If it does not, it is objectionable.

Mr. EDMONDS. We discussed it with Mr. Beecher the other night and Mr. Beecher said that had been discussed on the other side and the question had resolved itself down to the conditions of landing and unloading in certain places, and Mr. Beecher then made the statement that the Harter Act would cover the shore end, just the same as it does to day, because we do not amend the Harter Act or put it out of business at all.

Mr. LAWS. Then why not say so; why not make this conform to the Harter Act? Why have a conflict or gap in here, one covered by one law and the other by another law? Why not put a section in there

Mr. EDMONDS. The unfortunate part is we can not do that for foreign countries. We can do it for this country, but we can not do it for foreign countries. We can put it in for this country, if we so desire, but it will only act as a detriment to our shipowners, which we do not want it to do.

Mr. LAWS. The detriment must be there. If it is covered by the Harter Act, then the detriment is already there.

Mr. HAIGHT. Not in words.

Mr. Laws. If it is covered by the Harter Act, the detriment to the American shipping is there, is it not?

Mr. EDMONDS. Yes.

Mr. LAWS. Then why not make this conform to the Harter Act?

Mr. EDMONDS. If the Harter Act stays in effect

Mr. LAWS. Yes, if the Harter Act stays in effect, then the detriment exists to the American shipping.

Mr. EDMONDS. Yes.

Mr. Laws. All right; then we are no better off than if we would put it right into this bill and make it conform to the Harter Act in so many words, and say the Harter Act covers from the time the goods are delivered to the ship for transportation until whatever time you choose to put-until delivery to the consignee, or until notice is given. It is either there or it is not there.

Mr. EDMONDS. In doing that, we of course have to do something that is not in the conference rules, and if we do that they won't agree to it on the other side, and, therefore, the whole thing would fall.

Mr. Laws. I do not believe that the whole thing would fall, and let me answer that point right here. From the very first time these rules have been brought to the attention of any committee of Congress, or of any association with which I have been connected, the statement has been made by no less distinguished gentleman than my friend Mr. Haight, that you must not vary a word of these rules, because if you do the foreigners on the other side will never accept them. I heard that statement made from the very first draft, in 1920. I heard it in the next draft, and I hear it again here to-day, now; and yet I find that the first draft has been changed because American shipping interests would not stand for it. Then they got up another draft, another set of rules, and we heard it again-you don't dare change these rules; don't do anything that will militate against them, because the English underwriters, the English interests, and the foreign interests will never agree to it, and it is all gone; the whole thing falls unless you agree. We said "We won't agree; we do not care whether it falls, or not; if you do not protect the American interests, we are not going to agree to them-and they have been changed again. They are getting pretty close to what we can agree to, but they are going to be changed again.

Mr. EDMONDS. Suppose we insist on that and they do not agree. Then we fall back to the old Harter Act.

Mr. LAWS. It won't fall, because there is such a condition throughout the entire world of outrageous ladings by shipowners that there is bound to be a change and there is going to be a change, and the only question is shall we insist upon making a real change, a substantial change now; because, when this once goes through, there will be no change for the next 30 years. The thing has been started; it is well under way all over the world, and it is going to be changed just as sure as the sun rises and sets, and let us get it right while the change is in progress, instead of getting it right afterwards—undertaking to do it later on. That is what I have heard argued here to-day as well as every other day-let us get this as well as we can and later on get some further legislation, but let us get this now. But this is the time to do it. We have the whole world back of us; we have Congress in a condition where it recognizes something must be done and that it must be done right now, and if this Harter Act covers that gap in there, and if the American shipowner is at a disadvantage, let us come right out and put it in this, so that there will be no possible conflict between the two acts. That is my view of it.

Mr. EDMONDS. I think, looking at it from our American viewpoint, that would be very desirable. On the other end of the line, I am very dubious about being able to accomplish it. I would rather see this go through as it is, than not to accomplish anything.

Mr. Laws. You understand, Mr. Edmonds, that when this act is passed it will have precisely the same effect as the Harter Act does; namely, it will apply to any vessel bringing goods to or taking goods from the United States, whether that vessel be British, French, or any other kind. This act will apply to every vessel entering our ports, just as the Harter Act does.

Mr. EDMONDS. I think it is conceded on the other side that we could put in this bill or could extend the Harter Act to goods on shore before they were shipped or after they have been received for shipment; but then we place a detriment on our ships.

Mr. LAWS. I can not see it.

Mr. EDMONDS. Because the English would only do that when they come to our ports, and the other foreign ships would only do that when they come to our ports. In their own ports, they would do as they pleased, and the result would be that they

would have an advantage, their shipowners that would not come to our ports, because our ship owners would have to carry it out for the whole distance.

Mr. Laws. If the Harter Act applies, they are under that disadvantage anyhow, are they not?

Mr. EDMONDS. Yes; they are; but we have not had any ships operating except at a great loss.

Mr. LAWS. Then you have to wipe out the Harter Act to make it uniform entirely and simply adopt this act. In order to make it uniform, you have to do one thing or the other; you have to wipe out the Harter Act in order to make it uniform and of no disadvantage. But if it does apply and you put it right in here, then it will apply to every ship coming to this shore, whether foreign or American bottom.

Mr. EDMONDS. What would be the result so far as the ship going to England or Holland, we will say? The Holland ship would comply with the Harter Act with American shippers?

Mr. LAWS. Yes, sir.

Mr. EDMONDS. And it would comply with the Dutch act and the English act, as far as English and Dutch shippers were concerned?

Mr. Laws. Yes, sir.

Mr. EDMONDS. Our ships would have to comply with the Harter Act on both ends of the line and their ships would only have to comply with it on the one end of the line, under our law requiring them to do so.

Mr. LAWS, They do that now, if this Harter Act applies; that is the situation exactly.

Mr. EDMONDS. The Harter Act does not apply to goods on the English ship in England.

Mr. Laws. No; not in England.

Mr. EDMONDS. That is what I am trying to get at; we can not force the other ships to do this without putting it in this conference result, and that means calling a new conference.

Mr. Laws. It does if the owner of those goods comes back to New York and asserts it; if that ship comes back to New York, or any other ship of that line comes back to the United States, it does.

Mr. EDMONDS. If it is American goods.

Mr. Laws. Any goods. You can not ship English goods from here there.

Mr. EDMONDS. But suppose it was reloaded cargo; say it was a shipment of rubber brought from Brazil up to New York and then reshipped to England?

Mr. LAWS. Yes, sir.

Mr. EDMONDS. If it was carried to both places on an English ship, it would not apply?

Mr. LAWS. I think it would. If they asserted their claim in American courts, it would absolutely apply. As I understand the situation to-day, without you wipe out the Harter Act, it applies to any shipment or any loss that is asserted in American waters, in American courts, no matter where it goes or where it comes from.

Mr. EDMONDS. Of course, that means on a shipment of raw rubber it would not apply, because they would not sue in the American courts; it would be an English shipper on an English ship, and he would only apply to the English courts for redress.

Mr. Laws. I did not catch that?

Mr. EDMONDS. I say if the shipment is made in an English ship, and it is an English owner all the way through, of course, naturally, he would have no case in our courts. Mr. Laws. I do not see that that would be any special disadvantage to any American party, though.

Mr. EDMONDS. It would not be a disadvantage to the American shipper; it would not matter to anybody but the American shipowner in trying to compete with those folks.

Mr. Laws. If he had to run to the same place and with that particular clause put into effect, it would probably militate against the American shipowner, if the rates had nothing to do with it; but that is an exceptional case. But as the law stands to-day, if the Harter Act is in effect (and you have to wipe it out in order to do away with it), the American shipowner is at a disadvantage, because he is liable for the care and custody of those goods from the time they are delivered to him for transportation until they are delivered at the other end. And you either have to wipe out that Harter Act completely, which will never be done, or that disadvantage exists. But it is practically nothing in my opinion; I do not think it amounts to anything, because every ship of any foreign nation that comes to the United States ports with damaged goods under the bill of lading, you can assert that in our courts, and we have caught them time and time and time again when they came back to the American ports.