## Facts

- Osaka Shosen Kaisha, owner of the *Saigon Maru*, chartered the vessel (including deck) to Pacific Export Lumber Company to carry a full cargo of lumber from the Columbia or Willamette River to Bombay.
- Pacific Export tendered lumber at the loading ports, and the vessel loaded only part of the cargo.
- The *Saigon Maru* refused to take the remainder of the lumber, leaving a substantial quantity ashore.
- Pacific Export claimed damages for breach of the contract of affreightment and sought to enforce those damages in rem as a maritime lien against the vessel.
- The district court recognized a lien securing the shipper’s damages; the Ninth Circuit affirmed.

## Issues

1. Whether the existence and scope of a lien for breach of a maritime contract of affreightment is governed by federal maritime law or may be controlled or expanded by state statute.
2. Whether acceptance and loading of part of the designated cargo creates a maritime lien on the vessel for damages arising from the vessel’s refusal to load and carry the remainder.

## Decision

- The Supreme Court reversed.
- The existence of a lien to secure damages for breach of a maritime affreightment contract is a question of federal maritime law, not controllable by state statute.
- Acceptance of part of the designated cargo does not create a maritime lien on the vessel for damages resulting from refusal to take the rest.
- Because the disputed lumber was never loaded, the in rem claim based on a maritime lien could not be maintained.

## Legal Principles

- Maritime liens are stricti juris: because they operate as non-possessory and often undisclosed encumbrances, they are not extended by construction, analogy, or inference.
- A maritime lien presupposes mutuality and reciprocity between ship and cargo; a cargo-owner lien generally requires a reciprocal ship’s lien against that cargo.
- A vessel may be subject to a lien for obligations concerning cargo actually shipped (e.g., damage to or failure to deliver loaded goods), but not for refusal to carry goods left ashore.
- State statutes cannot confer or expand a maritime lien where federal maritime law denies it, because uniform maritime rules govern lien creation and scope.

## Conclusion

The Court held that federal maritime law exclusively governs maritime lien questions and that partial loading under a contract of affreightment does not create a lien for damages tied to the vessel’s refusal to load and carry the remaining, unshipped cargo.


Osaka Shosen Kaisha v. Pac. Exp. Lumber Co. (The Saigon Maru), 260 U.S. 490 (1923)