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June 9, 1970

Nikolaos BASSIS et al., Plaintiffs,
UNIVERSAL LINE, S.A. and Andreas Konstantinidis, Defendants, and The SS CARIBIA, her Engines, Boilers, Tackle and Appurtenances, Defendant. Fotios THEODORATOS et al., Plaintiffs, v. UNIVERSAL LINE, S.A. and Andreas Konstantinidis, Defendants, and The SS CARIBIA, her Engines, Boilers, Tackle and Appurtenances, Defendant

Dooling, District Judge.

The opinion of the court was delivered by: DOOLING


DOOLING, District Judge.

 Counsel by stipulation have taken a huge step toward putting the crew claims in shape for economical and early adjudication. They have agreed on a complex schedule of alternative average wage figures that are designed to cover every eventuality of decision on the legal issues. By this means the need for detailed trials of individual claims has been eliminated. Now, cross motions for summary judgment reach the dispositive legal issues presented on the first, third and fourth causes of action. The claims arise out of the Caribia's misadventures. Acquired by defendant Universal, a Panamanian corporation, in July 1968, the Caribia is registered in Panama and flies that nation's flag. She was outfitted for cruise service by January 27, 1969, and in the preceding November 1968 was in Piraeus, Greece, where apparently many of her crew of about 520 were hired. Each crew member, in any event signed one or another counterpart of a short "Seaman Agreement" which referred to the Greek Maritime Code Articles 53 and 54, was in the Greek language and referred to the "Greek Collective Agreement" as governing overtime and working conditions. The agreement was for one year, and it stated simply that the crewman "signed on" or was "engaged" at the indicated rating. The money to be paid him was set out in four parts and a total, e.g. : Wage $60.00 Sunday (11%)* 7.20 N.A.T. (16%)* 9.60 Bonus 13.20 Total $90.00

 The N.A.T. amount was a social welfare charge or tax levied at the rate of 8% each on employer and employee; ordinarily it was withheld and paid over by the employer. The N.A.T. form used connoted that in the Caribia hirings there would be no withholding from the crewmen nor payment by the employer. The "bonus" was the amount that, it had been decided by the shipowner and officer personnel with the hiring agent, would be offered over and above the rates provided in the Greek Collective Agreement in signing on the Caribia crew.

 The Greek Collective Agreement was an agreement between certain Greek labor unions and an Association of shipowners. It provided for overtime at flat hourly rates none of which exceeded 70 cents. The Collective Agreement provided that claims arising out of employment were governed by the Collective Agreement and Greek law and were to be decided by Greek Authorities in Greek Law Courts, resort to foreign courts and law "being prohibited and expressly ruled out."

 It is inferable that a great many of the crewmen were hired in Greece, but many, if not all, of the Greek agreements were notarized in Naples, Italy on or about January 22, 1969, before the Panamanian Consul in that City in order to give them some validity under Panamanian law.

 In addition, however, there were executed the forms of "Crew Roll and Agreement between Master and Seamen in the Merchant Service of the Republic of Panama" prescribed by the Labor Code of Panama Articles 135-136. While it seems that the crewmen were permitted to sign agreements, comparable to the Greek agreements, each according to his nationality, all crewmen signed the Panamanian Crew Roll and Agreement; many signed in Naples in January and the Panamanian Consul there notarized a great many of the Crew Roll entries; other crewmen signed the Roll in other ports, and Panamanian Consuls in various ports notarized the crewman entries (for example the Consul in Puerto Rico notarized on February 17, 1969, entries of crewmen who had signed on in Naples and Lisbon in late January and early February 1969). The Crew Roll and Agreement is very explicitly drawn under and invokes Panamanian law in the fullest sense.

 The Crew Roll and Agreement, in Spanish and English, described the Caribia as bound from Athens to "Mar-Mediterraneo y Oceanos" and other ports and places in any part of the world as the Master might direct; the final port of discharge was left blank. The term was expressed as, For a time not exceeding "doce (12)" months.

 The Caribia sailed from Naples for New York on January 27, 1969, arrived at New York on February 13, 1969, was certificated as seaworthy on that day by the Coast Guard, and sailed on her first cruise to the Caribbean on February 14, 1969. She returned on February 28, 1969, and set sail on her second Caribbean cruise on the evening of the same day. She never completed it.

 On March 5, 1969, between St. Thomas and LaGuaira at 5:50 A.M. a generator room accident filled it with live steam, the main electrical switchboard short-circuited and all power was lost for fourteen hours. Temporary repairs enabled the Caribia to return to St. Thomas where she anchored on March 6, putting her passengers ashore or transferring them to other ships. Advised that permanent repairs could not be made in St. Thomas, and simultaneously deprived of her certificates by the Coast Guard, the Caribia has never since carried a passenger; her cruise passengers were returned to New York by other means. The Caribia got to Puerto Rico with tug escort, and she was there from March 10 to 21 undergoing temporary repairs that restored two of her four generators to service.

 During the eleven days in Puerto Rico the crew (having no air conditioning and unsatisfactory living conditions) struck and picketed the vessel, demanding to be paid off and repatriated. The greater part of the crew was paid off and repatriated from San Juan, Puerto Rico. With the remaining crewmen the Caribia returned to New York and there most of the remainder of the crew were, on their demand, paid off and repatriated. About thirty remained aboard during layup for repairs.

 The crew of the Caribia were paid monthly and signed a Wages Account at each payment date which recited their rank, total monthly wage rate, the dates of the pay-period covered and the computation of wage, overtime, deductions, etc. The Wages Account stated, in Greek and in English, just above the crewman's signature, "I received my wages up to date in full settlement including overtimes, leave allowance etc., and have no further claim whatsoever against the Vessel, her Owners, Master or any Agents thereof." During the period the Caribia was in service, and when the crew members were paid off after the breakdown, they were paid according to the Greek agreement scales for pay and overtime, signed the receipt form and signed off the Crew Roll and Agreement.

 When the breakdown occurred, all members of the crew who left the ship -- and nearly all left it either in Puerto Rico or in New York -- were paid their wages to date, a severance sum equal to 45 times their full wage (inclusive of the Sunday allowance, N.A.T. amount and bonus) plus a food allowance, and all were repatriated or were offered and declined repatriation. There were no unresolved controversies over the payment of wages. Only two men protested, and only one of those is a plaintiff.

 Plaintiffs contend that they were not and should have been paid their wages and terminal allowances under Panamanian law, using as a base for the computation of overtime and premium pay the total wage shown in the Greek agreements (and not the base wage component of that total) and adding to that base the wages in kind (Labor Code Article 183) that the men received in food and quarters on shipboard. The additional wage payments claimed include (a) overtime recomputed at the Panamanian rates of 1 1/4 and 1 1/2 times straight time rates (averaged out, by stipulation effective if plaintiff's contention is legally correct, at 1 1/3 times straight time rates); (b) Sunday pay computed at the Panamanian premium rate of 1 1/2 times straight time pay for Sunday straight time work; (c) in each week in which seven days were worked, pay at the overtime rate for one additional day; and (d) vacation pay accrued to the date employment terminated (Article 1, Law No. 7 of January 26, 1950), stipulated as equal to 3.4 days, if due at all. In addition plaintiffs claim the per diem exaction of 46 U.S.C. § 596, and indemnifying pay for the balance of the alleged employment period on the basis that the discharge of the crew was unjustified (Labor Code, Article 78). Defendants deny each contention, insisting that the Greek agreements control, that there was no unjustified refusal or neglect to pay wages, and no unjustified dismissal of the crew entitling the men to damages for the balance of a one year's engagement.

 The first question presented is whether Panamanian law governs, and particularly, the Labor and Commercial Codes. No ground appears for rejecting the law of the flag. Cunard S.S. Co. v. Mellon, 1923, 262 U.S. 100, 123, 43 S. Ct. 504, 67 L. Ed. 894; United States v. Rodgers, 1893, 150 U.S. 249, 260, 14 S. Ct. 109, 37 L. Ed. 1071. The owner was Panamanian, the registry Panamanian and every step taken in crew dealings was taken in the framework of compliance with and subjection to the Panamanian law. The Greek Agreements uncertainly invoke Greek law, but care was taken to have the Panamanian Consul notarize them, and no one has suggested obedience to the mandate of the Collective Agreement that litigation be confined to the Greek courts. The question whether the Greek agreements as contracts, can be given effect according to their terms under Panamanian law must be answered in the negative. The provisions of the Greek contracts with reference to overtime and overtime rates of pay, Sunday work and day-of-rest did not meet the standards of Panamanian law, and under the law of Panama those are provisions of law that cannot be constitutionally waived (Article 70 of the Constitution).

 All except four of the plaintiffs are Greek nationals; three are nationals of Jugoslavia and one a national of the United Kingdom. The crew had included also Turks and Italians and they, on their insistence, were paid off and repatriated under their respective collective agreements rather than the Greek Collective Agreement. While, therefore, an effort was made to satisfy crewmen according to their own customs, the general law of the vessel was taken by the shipowner to be ...

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