The opinion of the court was delivered by: MOSCOWITZ
MOSCOWITZ, District Judge.
This is a proceeding for limitation of liability brought by the Companhia De Navegacao Lloyd Brasileiro for damage sustained by virtue of a collision between the petitioner's steamer Mandu and the German steamer Denderah. The collision, which occurred on July 31, 1929, off the coast of Brazil, caused the Denderah to sink. The owner of the Mandu, a Brazilian vessel, instituted this proceeding seeking the benefits of the limitation of liability statutes of the United States and requesting the court, if found at fault for the damage sustained, to limit its liability to the value of the vessel and its pending freight in accordance with such statutes. Claimant's position is that of underwriter and subrogee as to certain cargo losses, and the assignee of other underwriters who paid losses to cargo owners on account of cargo damage sustained in the collision.
By order of this court dated January 29, 1936, petitioner was permitted to amend its petition and notice of objection to the claim filed by claimant herein. Articles "thirteenth" and "fourteenth" of the amended petition read as follows:
"Thirteenth: Petitioner further alleges:
"(a) that the aforesaid collision occurred, not on the high seas, but on the territorial waters of the United States of Brazil.
"(b) that at the time of the collision, the Mandu was a Brazilian vessel, flying the flag of the United States of Brazil, her home port being Rio de Janeiro, United States of Brazil.
"(c) That at the time of the collision the Denderah was a German vessel, flying the flag of the Republic of Germany, her home port being Hamburg, Germany.
"(d) That the republic of Germany and the United States of Brazil were at the time of the collision parties to a treaty entitled 'The International Convention for the Unification of Certain Rules of Law in Regard to Collision', also known as 'The Brussels Convention of September 23, 1910'.
"(e) That by said treaty said nations agreed on behalf of their nationals that where a collision occurred between their seagoing vessels, compensation due for damages caused to their vessels, or to any cargo on board thereof should be made in accordance with the provisions of said treaty, in whatever waters the collision took place; that said treaty should not affect in any way the law in force in each country with regard to the limitation of shipowners' liability; and that the provisions of said treaty should be applied as regards all persons interested when all the vessels concerned in any action were of the nationality of the high contracting parties. A full and true copy of said convention in the French language, together with a translation thereof in the English language, is annexed hereto, made a part hereof, and marked Schedule E.
"(f) that the aforesaid treaty was, at the times hereinbefore stated, and now is, in full force and effect between the Republic of Germany and the United States of Brazil.
"(g) that by virtue of the aforesaid treaty, if both vessles were in fault, the liability of each vessel is in proportion to the degree of faults respectively committed.
"(h) that the faults of the Denderah were very great and if this court holds Mandu was in any respect at fault, which petitioner denies, damages resulting from the collision should be allocated in proportion to the degrees of faults, pursuant to the provisions of said treaty.
"Fourteenth. That the claimant, the Great American Insurance Company was not at the times it filed its libels and its claim, and is not now, the real party in interest in respect of the damages by it demanded, or any of them; but that on the contrary all the real parties in interest are citizens and residents of the Republic of Germany and of the United States of Brazil; that the sworn allegations of the Great American Insurance Company, in its libels and claims, with respect to its title to said claims for said damages are untrue; that said claimant, the Great American Insurance Company is not now, and was not at the times it filed its libels and claim, subrogated to all claims which its assureds had against the steamship Mandu, as it alleged under oath; that on the contrary whatever interest the said Great American Insurance Company had or has by reason of any amounts it may have paid to its assureds, was insignificant in comparison with the total claims and demands it has made upon the steamship Mandu; that whatever amounts the Great American Insurance Co. paid to its assureds, or any of them, were payments of parts of the loss, ...