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January 12, 1966

S/S SHALOM, her engines, etc., and Zim Israel Navigation Co., Ltd., Respondents, and v. M/V STOLT DAGALI and A/S Ocean, Respondent-Impleaded (and five consolidated causes)

The opinion of the court was delivered by: EDELSTEIN

EDELSTEIN, District Judge.

 This is a motion by Zim Israel Navigation Co. to discontinue, without prejudice, its libel and impleading petitions against A/S Ocean arising out of the collision between the M/V STOLT DAGALI and the S.S. SHALOM which took place on November 26, 1964. Prior to the filing of Zim's libel and impleading petitions against A/S Ocean in this court, *fn1" A/S Ocean brought an action in Gothenburg, Sweden, against Zim for damages arising out of the same ship collision that is the subject of Zim's suit here. Having arranged settlement, at the eve of trial, with cargo interests, Zim's affidavit of October 15, 1965, states that the prime reason for requesting permission to discontinue its actions in his court is to avoid two separate trials of the issues arising out of the November 26, 1964, collision. A/S Ocean has declined to discontinue its action against Zim in Gothenburg, Sweden, and therefore, Zim maintains, it should be allowed to discontinue the actions here upon payment of statutory costs, without prejudice to its filing a cross claim in the suit now pending in Sweden. A/S Ocean takes the position that it has been put to great expense defending the actions brought by Zim in this court and it would therefore be unjust to allow Zim to discontinue these actions without giving A/S Ocean an opportunity to litigate the merits of Zim's claims. A/S Ocean does not object, however, to the discontinuance of Zim's actions if the court imposes upon Zim terms and conditions which will make A/S Ocean whole and prevent Zim from suing in any court other than the Gothenburg court in Sweden. The motion at bar raises the following issues: (1) whether this court has the power to impose terms and conditions upon Zim or whether the court must grant Zim's application upon its payment of statutory costs, and; (2) if the court has the power to impose conditions what conditions should be imposed.

 The Rules of Practice in Admiralty and Maritime Cases do not in terms provide solutions for these issues. Rule 44, however, provides that:

"In suits in admiralty in all cases not provided for by these rules or by statute, the District Courts are to regulate their practice in such a manner as they deem most expedient for the due administration of justice, provided the same are not inconsistent with these rules."

 In the absence of controlling rule or statute the question which this court must then decide is what procedure would be most "expedient for the due administration of justice."

 Zim's memorandum of law dated October 18, 1965, submitted in support of its motion to discontinue, relied, in part, on Rule 41(a)(2) of the Federal Rules of Civil Procedure, the relevant portion of which provides that:

"[An] action shall not be dismissed at the plaintiff's insistence save upon order of the court and upon such terms and conditions as the court deems proper. * * *"

 Notwithstanding their reliance, in part, on Fed.R.Civ.P. 41(a)(2), Zim's memoranda of October 18, 1965, and October 25, 1965, nevertheless cite cases which Zim urges demonstrate its absolute right to discontinue without prejudice upon the payment of statutory costs. In a letter addressed to the court dated October 26, 1965, Zim disclaims the applicability of Fed.R.Civ.P. 41(a)(2). A/S Ocean, on the other hand, has consistently maintained that the equitable principles of Fed.R.Civ.P. 41(a)(2) should be applied in admiralty.

 The Supreme Court has stated that at common law a plaintiff had

"[An] absolute right to discontinue or dismiss his suit at any stage of the proceedings prior to verdict or judgment * * *." Ex parte Skinner, 265 U.S. 86, 92-93, 44 S. Ct. 446, 447, 68 L. Ed. 912 (1924).

 In equity a bill could be dismissed without prejudice prior to the taking of testimony absent prejudice to the defendant (such as where the defendant might be entitled to a decree against the complainant). Compare Chicago & A.R. Co. v. Union Rolling Mill Co., 109 U.S. 702, 713-717, 3 S. Ct. 594, 27 L. Ed. 1081 (1884), and Conner v. Drake, 1 Ohio St. 166, 167, 170 (1853), with Thomson-Houston Elec. Co. v. Holland, 160 F. 768 (C.C.N.D.Ohio 1907) and City of Detroit v. Detroit City Ry., 55 F. 569, 572-576 (C.C.E.D.Mich.1893), appeal dismissed, 154 U.S. 500, 14 S. Ct. 1145, 38 L. Ed. 1084 (1894) and Cowham v. McNider, 261 F. 714-15 (E.D.Mich.1919). By the end of the nineteenth century the equity courts in this district conditioned a voluntary dismissal by a complainant upon the stipulation that testimony obtained by a defendant in preparation for trial be preserved and be admissible in any new suit by the complainant arising out of the same subject matter. See American Steel & Wire Co. v. Mayer & Englund Co., 123 F. 204 (C.C.S.D.N.Y.1903); American Zylonite Co. v. Celluloid Mfg. Co., 32 F. 809 (C.C.S.D.N.Y.1887); Brush v. Condit, 20 F. 826 (C.C.S.D.N.Y.1884), aff'd on other grounds, 132 U.S. 39, 10 S. Ct. 1, 33 L. Ed. 251 (1889). The Supreme Court, in the Confiscation Cases, 74 U.S. (7 Wall.) 454, 456-458, 19 L. Ed. 196 (1868) indicated that the common law rule would be applied in admiralty. That case, however, dealt only with actions in rem and it has been uniformly held that a vessel may be arrested only once on any cause of action, see The Gasconier, 8 F.2d 104 (E.D.N.Y.1924). Thus the dismissal referred to in the Confiscation Cases was, in effect, a dismissal with prejudice. The most illuminating discussion found among the early cases of what ought to be a libelant's power in admiralty to discontinue without prejudice is in a case not cited by either of the parties, Folger v. The Robert G. Shaw, 9 Fed.Cas. 335 (No. 4,899) (C.C.D.Mass.1847). Circuit Justice Woodbury, after briefly reviewing the common law and equity practices, stated that:

"The books of practice are rather meagre as to the form adopted in admiralty, under similar circumstances. But as the libel there is a substitute for the writ and declaration at common law, and for the bill in chancery, I see no reason why it may not be abandoned, or discontinued in a like stage of proceedings with the others, and with a like effect. Whether it be called a nonsuit, or discontinuance, or desertion of the cause, is immaterial; but it should operate as a mere discontinuance [without prejudice], if at a time when the merits are not developed, and cannot be ascertained. I have assumed as the guiding principle, it being the only one conceivable by me, that the precise stage, in which the discontinuance should be allowed without a judgment on the merits, and as a matter of right if claimed by the prosecuting party, is any progress in the cause, which has not yet furnished means to the court for a correct final decision." 9 Fed.Cas. at 336.

 After reviewing the common law experience with "repeated and vexatious suits" and after indicating that the practices varied among the states, Justice Woodbury utilized his view of the common law and equity procedures to derive the rule to be applied in admiralty cases:

"I think, however, the readiness for the trial, the call of the case, the expiration of the notice, and the introduction of any pertinent evidence, is, as before intimated, the true punctum temporis, when the right of the plaintiff to become nonsuit ceases, and that of the defendant begins for a final judgment; because, then, the parties have agreed in court, that final proceedings shall be had, then there is a presumed readiness for them, then they have begun, and means are before the court to settle the merits. Both parties then stand on an equality; neither is taken at a disadvantage then, by requiring judgment on the merits, unless special and good cause be assigned to the court for leave to become nonsuit; and then, so far as regards the defendant, a nonsuit by the plaintiff, at pleasure, as a right, is more vexatious; as then the mere costs are usually an inadequate remuneration for the expense of another preparation, and then a decision on the merits, if desired by the defendant, is practical in most cases, without being subjected to another action and preparation. It will be seen, that this test requires the case [at common law] to have been opened to the jury and some pertinent evidence submitted, if it be a trial on the general issues; or that the pleadings be closed if ending in a demurrer, so ...

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