Justice. Appleby v. City of Buffalo, 221 U. | penalty only, and does not prevent recovery on S. 524, 529, 31 Sup. Ct. 699, 55 L. Ed. 838; the ordinary liability on the undertakings of Hulbert v. Chicago, 202 U. S. 275, 280, 26 the contract, is presumed to represent the continental point of view. Sup. Ct. 617, 50 L. Ed. 1026; Marvin v. Trout, 199 U. S. 212, 223, 26 Sup. Ct. 31, 50 L. Ed. 157. We have no occasion, therefore, to consider whether the claim of denial of rights under the Fourteenth Amendment, was substantial in character which is required to support a writ of error. Equitable Life Assurance Society v. Brown, 187 U. S. 308, 311, 23 Sup. Ct. 123, 47 L. Ed. 190. Compare Henderson Light & Power Co. v. Blue Ridge Railway, 243 U. S. 563, 37 Sup. Ct. 440, 61 L. Ed. 900. Dismissed for want of jurisdiction. (252 U. S. 313) REDERIAKTIEBOLAGET ATLANTEN V. AKTIESELSKABET KORN-OG FODERSTOF KOMPAGNIET. (Argued March 10, 1920. Decided March 22, 1920.) 1. ARBITRATION AND AWARD 7 REFUSAL The refusal of a steamship owner to proceed with the voyage for which the steamer was chartered was not such a "dispute" as was covered by a clause of the charter party providing that, if any dispute arose, it would be settled by referees, one to be appointed by the captain, one by the charterers, and, if necessary, the arbitrators to appoint an umpire. [Ed. Note. For other definitions, see Words and Phrases, First and Second Series, Dispute.] 2. ADMIRALTY 61 ALLEGATIONS AS TO FOREIGN LAW RESPECTING ARBITRATION CON STRUED. In a suit in admiralty for breach of a charter party, an allegation of the answer that a provision of the charter for arbitration of any dispute was binding by the laws of Sweden and Denmark, and that arbitration was a condition precedent to the right to sue, merely meant that the agreement would be enforced according to its intent, and did not extend the scope, or affect the construction, of the provision. On Writ of Certiorari to the United States Circuit Court of Appeals for the Second Circuit. 3. SHIPPING 141(1)-LIMITATION OF LIABILITY IN CHARTER NOT APPLICABLE TO INEXCUSABLE REFUSAL TO UNDERTAKE VOYAGE. The provision of a charter that penalty for nonperformance should be proved damages, not exceeding the estimated amount of freight, if treated as a limitation of liability, did not apply to a case of willful unexcused refusal to go on with the voyage. Libel in admiralty by the Aktieselskabet Korn-Og Foderstof Kompagniet against the Rederiaktiebolaget Atlanten. A decree for the libelant (232 Fed. 403) was affirmed by the Circuit Court of Appeals for the Second Circuit (250 Fed. 935), and the claimant brings certiorari. Affirmed. See, also, 248 U. S. 553, 39 Sup. Ct. 8, 63 L. Ed. 418. This is a libel in admiralty by a Danish Corporation, the respondent here, against a Swedish corporation, owner of the steamship Atlanten, for breach of a charter party made in Denmark, on September 30, 1914. The voyage was to be from a southern port in the United States to Danish ports to be named. On January 8, 1915, the owner (the petitioner) wrote to the charterers that owing to the increased war risk and other difficulties "we are compelled to cancel the Atlanten's charter party Pensacola to Scandinavia, and are ready to take all the consequences the Court after Clause No. 24 in the charter party will compel us to pay, not exceeding the estimated amount of freight." It offered to proceed, however, if the charterers would pay a higher rate. This libel was brought five months later. The owner in its answer admitted the breach, but set up the *315 clause 24 of the char*ter, "Penalty for nonperformance of this agreement to be proved damages, not exceeding estimated amount of freight," and clause 21, "If any dispute arises the same to be settled by two referees, one to be appointed by the Captain and one by charterers or their agents, and if necessary, the arbitrators to appoint an Umpire. The decision * shall be final, and any party attempting to revoke this submisshall be liable to pay to the other or others, as liquidated damages, the estimated amount of chartered freight." It is alleged that by the sion to arbitration without leave of a court 4. EVIDENCE 81-MARITIME LAW OF ENG- laws of both Denmark and Sweden such a LAND PRESUMED FOLLOWED IN CONTINENTAL The rule in England that a provision of a charter providing that the penalty for nonperformance shall be proved damages, not exceeding the estimated amount of freight, is a provision is binding and that arbitration is a condition precedent to the right to sue by reason of any dispute arising under the charter. The case was heard on exceptions to the answer. The District Court made a de Messrs. John W. Griffin, of New York City, and Clarence Bishop Smith, of New York City, for petitioner. Mr. Roscoe H. Hupper, of New York City, for respondent. *314 *Mr. Justice HOLMES delivered the opinion of the Court. For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes (40 Sup.Ct.) cree for the libellant for full damages, | [1915] 3 K. B. 66; Watts, Watts & Co., Ltd. Aktieselskabet Korn-Og Foderstof Kompag- v. Mitsui & Co., Ltd., [1917] A. C. 227; niet v. Rederiaktiebolaget Atlanten, 232 Fed | [1916] 2 K. B. 826, 844; Watts v. Camors, 403, and this decision was affirmed by the 115 U. S. 353, 6 Sup. Ct. 91, 29 L. Ed. 406. Circuit Court of Appeals, 250 Fed. 935, 163 Presumably this is also the continental point C. C. A. 185, Ann. Cas. 1918E, 491. of view. We are of opinion that the decree was clearly right. Decree affirmed. 1920.) [1, 2] With regard to the arbitration clause we shall not consider the general question whether a greater effect should not be given to such clauses than formerly was done, since it is not necessary to do so in order to decide the case before us. For this case it is enough that we agree substantially with the views of Judge Learned Hand in the District Court and Judge Hough in the Cir- (Submitted March 8, 1920. Decided March 22, cuit Court of Appeals. Their opinion was that the owner repudiated the contract and that the arbitration clause did not apply. It is true that it would be inaccurate to say that the owner repudiated the contract in toto, for the letter that we have quoted assumed that the contract was binding and referred to it as fixing the liability incurred. It meant simply that the owner would not proceed with the voyage. United States v. McMullen, 222 U. S. 460, 471, 32 Sup. Ct. 128, 56 L. Ed. 269. But we agree that such a refusal was not a "dispute" of the kind referred to in the arbitration clause. (252 U. S. 344) STATE OF ARKANSAS v. STATE OF MISSISSIPPI. No. 7, Original. STATES 12(2)-BOUNDARY BETWEEN AR- The boundary line between Arkansas and Mississippi south of a point about one mile southwest of Friars Point, Miss., is in the middle of the main channel of navigation of the Mississippi river as it existed in 1783, subject to such changes as have since occurred through natural and gradual processes, but unaffected by the avulsion occurring about 1848, and resulting in the formation of a new main channel of navigation. *316 As Judge Hand remarked, the withdrawal was before the voyage began and it is absurd to suppose that the captain, who might be anywhere in the world, was to be looked up and to pick an arbitrator in such a case. The clause obviously referred to disputes that might arise while the parties were trying to go on with the execution of the contract-not to a repudiation of the substance of the contract, as it is put by Lord Haldane in Jureidini v. National British & Irish Mil lers Ins. Co., Ltd., [1915] A. C. 499, 505. The allegation in the answer as to the laws of Denmark and Sweden we do not understand to mean more than that arbitration agreements will be enforced according to their intent. It does not extend the scope or affect the construction of an agreement which, as we should construe it apart from that allegation, does not apply to the present case. [3, 4] Paragraph 24 of the charter, supposed to limit liability, may be met in similar and other ways. If it were a limitation of liability it hardly could be taken to apply to a case of wilful unexcused refusal to go on with the voyage. It obviously was not intended to give the owner an option to go on or stop at that price. But furthermore, as was fully pointed out below, the clause is a familiar modification of a very old one, and in the courts of England that have had frequent occasion to deal with it, is held to be only a penalty, even in the present form, and to leave the ordinary liability upon the undertakings of the contract unchanged. Wall v. Rederiaktiebolaget Luggode, sippi River as it existed at the Treaty of 1. The true boundary line between the States of Arkansas and Mississippi, at the places in controversy in this cause, aside from the question of the avulsion of 1848, hereinafter mentioned, is the middle of the main channel of navigation of the Missis For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes In Equity. Original suit by the State of Arkansas against the State of Mississippi. On motions for the appointment of a commission to run, locate, and designate the boundary line, Commissioners appointed and instructed as to their duties. See, also, 250 U. S. 39, 39 Sup. Ct. 422, 63 L. Ed. 832. Messrs. John D. Arbuckle, Atty. Gen., John M. Moore, of Little Rock, Ark., and Herbert Pope, of Chicago, Ill., for State of Arkansas. Messrs. Frank Roberson, Atty. Gen., Gerald Fitz Gerald and George F. Maynard, both of Clarksdale, Miss., and Marcellus Green and Garner W. Green, both of Jackson, Miss., for State of Mississippi. This cause came on to be heard by this Court on the motions and suggestions of counsel for the respective parties for the appointment of a commission to run, locate, and designate the boundary line between the States of Arkansas and Mississippi as indicated in the opinion of this Court delivered *345 on the 19th day of May, 1919, and *thereupon and on consideration thereof, It is ordered, adjudged and decreed as follows, viz.: Peace concluded between the United States | their report. Said Commission is authorized and Great Britain in 1783, subject to such changes as have occurred since that time through natural and gradual processes. 2. By the avulsion which occurred about 1848, and which resulted in the formation of a new main channel of navigation, the boundary line between said States was unaffected, and remained in the middle of the former main channel of navigation as above defined. and empowered to make examination of the territory in question, and to adopt all ordinary and legitimate methods in the ascertainment of the true location of the said boundary line; to examine and consider carefully the printed record in this cause and the opinion of this Court delivered on May 19, 1919, and to take such additional evidence under oath as may be necessary and authorized to enable said Commission to determine said boundary line, but such evidence shall be taken only upon notice to the parties with permission to attend by counsel and cross-examine the witnesses; to compel the attendance of witnesses and require them to testify; and all evidence taken and all exceptions thereto and rulings thereon shall be preserved, certified and returned with the 3. The boundary line between the said States should now be located along that portion of said river, or the bed of said river, which ceased to be the main channel of navigation as the result of said avulsion, according to the middle of the main navigable channel as it existed immediately prior to the time of said avulsion. *347 4. A commission consisting of Samuel S. Gannett, Washington, D. C., Charles H. Mil-report of said Commissioners; and *said Commission shall do all other matters necler, Little Rock, Arkansas, and Stevenson Archer, Jr., Greenville, Mississippi, compe- to obtain the end to be accomplished conessary to enable it to discharge its duties and tent persons, is here and now appointed by formably to this decree. the Court, to run, locate and designate the boundary line between said States along that portion of said river which ceased to be a part of the main navigable channel of said river as the result of said avulsion, in ac cordance with the above principles: Commencing at a point in said Mississippi River about one mile southwest from Friars Point, Coahoma County, Mississippi, where the main navigable channel of said river, prior to said avulsion, turned and flowed in a southerly direction, and thence following *346 along the middle of the former main *channel of navigation by its several courses and windings to the end of said portion of said Mississippi River which ceased to be a part of the main channel of navigation of said river as the result of said avulsion of 1848. 5. In the event the said Commission cannot now locate with reasonable certainty the line of the river as it ran immediately before the avulsion of 1848, it shall report the nature and extent of the erosions, accretions and changes that occurred in the old channel of navigation as the result of said avulsion, and in said report, if necessary to be made in obedience to this paragraph of the decree, said Commission shall give its findings of fact and the evidence on which same are based. 6. Before entering upon the discharge of their duties, each of said Commissioners shall be duly sworn to perform faithfully, impartially and without prejudice or bias the duties hereinafter imposed; said oaths to be taken before the Clerk of this Court, or before the clerk of any District Court of the United States, or before an officer authorized by law to administer an oath in the State of Arkansas or Mississippi, and returned with 7. It is further ordered that should any vacancy or vacancies occur in said Board of Commissioners by reason of death, refusal to act, or inability to perform the duties required by this decree, the Chief Justice of this Court is hereby authorized and empowmissioners to supply such vacancy or vacanered to appoint another commissioner or comformation in the premises as may be satiscies, the Chief Justice acting upon such infactory to him. 8. It is further ordered that said Commissioners do proceed with all convenient dispatch to discharge their duties conformably to this decree, and they are authorized, if they deem it necessary, to request the cooperation and assistance of the State authorities of Arkansas and Mississippi, or either of those States, in the performance of the duties hereby imposed. 9. It is further ordered that the Clerk of this Court shall forward at once to the Governor of each of said States of Arkansas and Mississippi and to each of the Commissioners hereby appointed a copy of this decree and of the opinion of this Court delivered herein May 19, 1919, duly authenticated. 10. Said Commissioners shall make a report of their proceedings under this decree as soon as practicable on or before the first day of October, 1920, and shall return with their report an itemized statement of services performed and expenses incurred by them in the performance of their duties. 11. All other matters are reserved until the coming in of said report, or until such time as matters pertaining to this cause shall be properly presented to this Court for its consideration. Per Mr. Chief Justice WHITE, (40 Sup.Ct.) (252 U. S. 317) MANNERS v. MOROSCO. Peg O' My Heart to restrain the defendant, (Argued March 2, 1920. Decided March 22, tion pictures, in violation of the plaintiff's 1920.) copyright; and also, although this is a subsidiary question, from producing the play at all. The defendant justifies under an agreement of January 19, 1912, and a supplemental agreement of July 20, 1914, both set forth in the bill. The ground upon which the right to produce the play in any way was denied was that the agreement gave rights only for five years. This construction was rejected by the District Court and the Circuit Court of Appeals. Both Courts held also that the agreement conveyed the right to represent the play in moving pictures and on that ground dismissed the bill. 254 Fed. 737; 258 Fed. 557. No. 370. 1. COPYRIGHTS 48-LICENSE FOR USE OF COPYRIGHTED PLAY NOT LIMITED TO FIVE YEARS. An exclusive license to produce a copyrighted play, requiring the licensee to produce it for at least 75 performances during a given season and for each theatrical season thereafter for 5 years, and providing for forfeiture if it was not produced for the specified number of performances, was not limited, as to duration, to 5 years, especially where it provided for the release of the play for stock companies in case it failed in New York and on the road. 2. COPYRIGHTS 48-LICENSE FOR USE OF COPYRIGHTED PLAY HELD NOT TO GRANT MOVING PICTURE RIGHTS. Where an exclusive license for the production of a copyrighted play required 75 performances each theatrical season, provided for royalties, consisting of specified percentages of the gross weekly receipts, required the play to be presented in first-class theaters with a competent company, and with the author's wife in the title rôle and provided that no alterations, eliminations, or additions should be made without the author's approval, and that rehearsals and the production of the play should be under his direction, it did not grant the right to produce the play in moving pictures. 3. COPYRIGHTS 48-LICENSOR IMPLIEDLY COVENANTS NOT TO PRODUCE PLAY IN MOV ING PICTURES. Though an exclusive license to produce a copyrighted play did not grant the licensee the right to produce it in moving pictures, it was an implied covenant that the licensor would not destroy the value of the right granted by so producing it. tions of the contract. Morosco *agrees "to produce the play not later than January first, 1913, and to continue the said play for at least seventy-five performances during the season of 1913-1914 and for each theatrical season thereafter for a period of five years." He agrees further to pay specified percentages on the gross weekly receipts as royalties, and that "if during any one theatrical year • said play has not been produced or presented for seventy-five performances, then all rights of the said party of the second part shall cease and determine and shall immediately revert to the said party of the first part." Morosco further agrees to present the play in first-class Mr. Justice Clarke and Mr. Justice Pitney theatres with competent companies and with dissenting. Miss Laurette Taylor (the stage name of the author's wife) in the title rôle; the play to have a production in New York and to be continued on the road for at least one season or longer if considered advisable by both parties. No alterations, eliminations or additions are to be made without the approval of the author and the rehearsals and production of the play are to be under his direction. The author to have the right to print and publish the play but not within six months after the production of the play in New York City without consent. Morosco is not to let or transfer his rights without the author's consent. "Should the play fail in New York City and on the road it shall be released for stock;" i. e., let to stock companies, with an equal division of royalties between plaintiff and defendant. By an addendum, after Miss Tay *323 *Mr. Justice HOLMES delivered the opin- lor should have finished her season her sucion of the Court. cessor in the rôle of "Peg" for any subseThis is a suit by the author of a play called quent tours shall be mutually agreeable to For other cases see same topic and KEY-NUMBER in all Key-Numbered Digests and Indexes On Writ of Certiorari to the United States Circuit Court of Appeals for the Second Circuit. Suit by J. Hartley Manners against Oliver Morosco. A decree dismissing the bill (254 Fed. 737) was affirmed by the Circuit Court of Appeals for the Second Circuit (258 Fed. 557), and plaintiff brings cerReversed, and injunction granted See, also, 250 U. S. 638, 39 Sup. Ct. 494, tiorari. 63 L. Ed. 1183. Messrs. David Gerber and Walter C. Noyes, both of New York City, and William J. Hughes, of Washington, D. C., for petitioner. Mr. Charles H. Tuttle, of New York City, for respondent. By the first agreement the plaintiff, party of the first part "does grant" to Morosco, the party of the second part, "the sole and exclusive license and liberty to produce, perform and represent the said play in the United States of America and the Dominion of Canada," subject to the terms and condi *324 both parties. The contract is declared bind- [ shows that a representation by spoken drama ing upon the parties, "their heirs, executors, assigns, administrators and successors." The second agreement, in order to adjust controversies and to modify the first, authorized Morosco "as long as this contract is in force" "to produce, perform and represent"| the play with or in as many companies as he alone is provided for. The play is to be continued for seventy-five performances for the theatrical seasons named. This applies only to the regular stage. The royalties are adapted only to that mode of presentation. Harper Bros. v. Klaw (D. C.) 232 Fed. 609, 612. The play is to be presented in firstclass theatres with a competent company and with Miss Laurette Taylor in the title rôle, which, of course, does not mean in moving pictures. The stipulations against alterations, eliminations or additions, and that the rehearsals and production of the play shall be under the direction of the author, denote the same thing, and clearly indicate that no other form of production is contemplated. The residuary clause, so to speak, by which the play is to drop to stock companies shows the lowest point to which the author was willing to let it go. *325 saw fit, *without engaging Laurette Taylor and without consulting the plaintiff as to the cast, rehearsals or production of the play. Morosco also was authorized to let or sell any of his rights under the contracts, but he was not to be released from his personal liability to pay the royalties as specified in the contracts. The play might be released for stock whenever the net profits realized from all the companies producing the play should be less than $2,000, and then the royalties received from the stock theatres were to be divided equally. For four years from date neither party without consent of the other was to produce or give leave to produce the play by moving pictures and after that the rights of the parties were to be determined by and under the original agreement as if the supplemental agreement had not been made. [1] As to the duration of the defendant's rights we agree with the Courts below. We perceive no ground for converting the defendant's undertaking to continue the play for seventy-five performances during the season of 1913-1914, and for each season thereafter for five years, into a limit of the plaintiff's grant of rights. As was said in the District Court, it is a statement of the least the defendant was to do, not of the most that he was to have. The plaintiff was secured sufficiently by the forfeiture in case the play should not have been produced for seventy-five performances. The provisions in both contracts as to the release for stock are somewhat of an additional indication that it was expected that the arrangement was to last as long as the public liked the play well enough to make it pay, provided the defendant kept his half of the bargain performed. [2] On the question principally argued we are of opinion that the majority below was wrong. The thing granted was "the sole and exclusive license and liberty to produce, perform and represent" the play within the territorial limits stated, subject to the other *326 terms of the contract. *It may be assumed that those words might carry the right to represent the play in moving pictures if the other terms pointed that way, but to our mind they are inconsistent with any such intent. We need not discuss the abstract question whether, in view of the fact that such a mode of representation was familiar, it was to be expected that it should be mentioned if it was to be granted or should be excluded if it was to be denied. Every detail [3] The Courts below based their reasoning upon the impossibility of supposing that the author reserved the right to destroy the value of the right granted, however that right may be characterized, by retaining power to set up the same play in motion pictures a few doors off with a much smaller admission fee. We agree with the premise but not with the conclusion. The implied assumption of the contract seems to us to be that the play was to be produced only as a spoken drama, with respect for the author's natural susceptibility concerning a strict adhesion to the text. We need not amplify the argument presented below against the reser *327 vation of the right in *question. As was said by Judge Hough in a similar case: "There is implied a negative covenant on the part of the [grantor] * * not to use the ungranted portion of the copyright estate to the detriment, if not the destruction, of the li(or Klaw and Erlanger, for the matter of that) censees' estate. Admittedly, if Harper Bros. permitted photo-plays of Ben Hur to infest the country, the market for the spoken play would be greatly impaired, if not destroyed." Harper Bros. v. Klaw (D. C.) 232 Fed. 609, 613. The result is that the plaintiff is entitled to an injunction against the representation of the play in moving pictures, but upon the terms that the plaintiff also shall abstain from presenting or authorizing the presentation of the play in that form in Canada or the United States. Decree reversed. Injunction to issue upon the condition that the plaintiff shall neither represent nor authorize the representation of the play Peg O' My Heart in moving pictures while the contract with the defendant remains in force. Mr. Justice CLARKE dissenting. The decision of this case involves the construction of the written contract of January 19, 1912, as modified by that of July 20, 1914, and, centering its attention upon the claim of the defendant to moving picture rights |
