I have stated in my statement, Mr. Chairman, that it was first cut and joined in La Spezia, Italy, and then when it was rejoined, it was towed to Spain for the conversion into a bulk carrier from a tanker. But both contracts existed before the law was enacted. The CHAIRMAN. Do you have the certified copies of both contracts? Mr. WANG. They are at Maritime Administration. I will have to go there and ask for copies. The CHAIRMAN. You did not bring them down here and put them in the record, did you? Mr. WANG. I would like to bring to your attention, Mr. Chairman, that Mr. Alexander, the Maritime Administrator, has made the statement here. The CHAIRMAN. I do not care about that. These contracts are what we want here, whether there was actually a contract in this Spanish shipyard prior to 1961. Mr. WANG. Mr. Chairman, if I get a copy and a letter from the Maritime Administration that this is a copy that they made from a true copy, would that suffice? The CHAIRMAN. I do not know what they accepted but you get a certified copy from that Spanish yard that there was a contract existing prior to 1961 within the specified time. You understand what I mean? Mr. WANG. Yes, Mr. Chairman, I have it. The CHAIRMAN. Are there any further questions? Mrs. SULLIVAN. That is all. Mr. WANG. Thank you, sir. (The following letter with attachments was subsequently supplied for the record:) Re SS Spitfire. Hon. HERBERT C. BONNER, GENERAL CArgo Corp., New York, N ̧Y., July 12, 1963. Chairman, Committee on Merchant Marine and Fisheries, House of Representatives, Washington, D.C. DEAR MR. CHAIRMAN: In accordance with your request at the committee's hearing on H.R. 2457 on July 9, 1963, I am pleased to enclose herewith a certified copy of General Cargo Corp.'s construction contract with the Spanish shipyard under which the SS Spitfire was reconstructed. This contract was filed with the Maritime Administration on November 9, 1961, in response to its request of October 26, 1961. Enclosed are (a) A certified copy of the contract dated August 2, 1961, for the conversion of the E880 Buffalo. (b) Specifications dated July 1961. (c) An amendment to the above contract dated August 16, 1961. Please note item 1 of this amendment: "1. Owner: General Cargo Corp., of New York, N.Y., U.S.A." And Item 3: "3. Vessel: Forward part of ex Esso Syracuse, between frames 29-30 and stem. "Stern part of ex Esso Buffalo, between stem and frames 22-23." Also, please note: 1 Particulars of the converted vessel are as follows: Length overall, 625 feet 91⁄2 inches. Length b.p., 603 feet. Beam molded, 70 feet. Depth molded, 48 feet. (d) A certification by the secretary of this corporation which is self-explanatory. These documents clearly answer the questions that have been raised by one opponent as to the matter of ownership, and by Mr. Shapiro as to the matter of the existence of the contract for the two halves of the vessel. For the record, the vessel by itself is still the Esso Buffalo. However, we could hardly use the name of Esso and the change of name in this instance to Spitfire was mandatory. It was on the basis of the enclosed contract with the shipyard, as amended, that Mr. Alexander, the Maritime Administrator, testified before your committee on September 25, 1962, that "if the Spitfire had been reconstructed and redocumented on or before September 21, 1962, we (the Maritime Administration) would certify that the vessel would have been a 'privately owned U.S.-flag commercial vessel' for the purposes of section 901 of the 1936 act." As I stated in the hearing, it is well settled that a vessel is considered rebuilt if any considerable part of the stern, including the engine, of the old vessel remained intact and was joined with the forward portion of the hull of another vessel. The regulations of the Bureau of Customs concerning the documentation of the vessels provide as follows: "A vessel may be deemed to have been rebuilt if any considerable part of the hull in its intact condition, without having been broken up, is built upon or substantially altered." (19 CFR sec. 328 (a).) Accordingly, the Spitfire is considered to be the rebuilt Esso Buffalo, and this rebuilding was carried on under the enclosed construction contract. If the committee desires any further information in connection with this matter, please let me know. Again, I wish to express my thanks to the committee for allowing me the opportunity of appearing at its hearing on July 9. Sincerely yours, SAMUEL H. WANG. GENERAL CARGO CORPORATION SECRETARY'S CERTIFICATE I, Herman L. Miller, Secretary of General Cargo Corporation, a New York corporation, hereby certify that attached hereto is a true and complete copy of the following documets: 1. Contract between Sociedad Espanola de Construccion Naval, S.A., and Progressive Steamship Corporation dated August 2, 1961. 2. Amendment to contract between Sociedad Espanola de Construccion Naval, S.A., and Progressive Steamship Corporation dated August 16, 1961, naming General Cargo Corporation as the vessel owner and describing the vessel as constructed of the forward part of the ex-Esso Syracuse and the stern part of the ex-Esso Buffalo. Copies of these documents were filed with the Maritime Administration, United States Department of Commerce, on November 9, 1961, in response to its request of October 26, 1961. In witness whereof I have set my hand and affixed the seal of said Corporation this 11th day of July, 1963. [SEAL] STATE OF NEW YORK, County of New York, 88: GENERAL CARGO CORPORATION, By HERMAN L. MILLER, Secretary. On this 11th day of July, 1963 before me personally appeared Herman L. Miller to me known and known to me to be the individual described in and who executed the within instrument and he duly acknowledged to me that he executed the same. ROBERT L. WEINER, Notary Public, State of New York. Qualified in Queens County; commission expires March 30, 1965. 1. Owner SOCIEDAD ESPAÑOLA DE CONSTRUCCIÓN NAVAL. PROGRESSIVE STEAMSHIP CORP., INC., 666 FIFTH AVE., NEW YORK, N.Y.: Authority to give directions under this contract and to approve for the Owner actions taken by the Contractor in the performance of the contract work shall be vested in such officers or employees or representatives of the Owner as he may designate. The Contractor shall have no obligation or authority to follow any direction to deviate from the specifications or contract agreements except those which shall be issued in writing over the signature of such a representative. 2. Work to be performed Material and workmanship to be generally in accordance with specifications prepared by Marine Architects, Inc., of New Jersey for the conversion of a tanker to a Bulk Carrier. Copies of said specifications are attached to this Contract and made part thereof. It is understood that the Contractor shall prepare detailed drawings to be approved by the Owner's design agents and the American Bureau of Shipping where applicable. Working drawings and all design data to become the property of the Owner. Wherever the attached specifications leave any construction or arrangement to the option of the Contractor, said construction and arrangement shall be approved by the Owner's design agents and the American Bureau of Shipping where applicable. Decision of the American Bureau of Shipping as to the conformity or nonconformity with the classification requirements shall be final and binding upon both parties hereto. 3. Vessel Vessel to be converted: ex: Esso Buffalo or substitute. Length overall: 543 feet 91⁄2 inches. Length between perpendiculars: 521 feet. Beam molded: 70 feet. Depth molded: 40 feet. 4. Contract price The Owner, in consideration of and subject to the successful performance and observance on the part of the Contractor and his obligation under this contract, agree to pay the Contractor the full amount of the Contract Price the sum of $408,000 based upon conditions of our offer 2nd August, 1961. 5. Modification, changes, and extras The specifications pertaining to this Contract may be modified and changed at any time hereafter by written agreement of the parties hereto: Provided, however, That any modifications or changes requested by the Owner shall be effected by the Contractor if the Owner shall assent to adjustment of price, time for delivery, and other terms of this Contract. Cost of modifications to Owner to be based on quoted prices for new and old steel. Any such agreement for modifications and changes shall include an agreement as to the increase or decrease, if any, in the Contract price of the vessel together with an agreement as to any extension or reduction in the time for delivery. 6. Delivery The vessel will be delivered to the Contractor, on or before the 15th October, 1961, and the Contractor will redeliver the converted vessel within six months in the Contractor's yard, or at a mutually agreed location. The delivery date to be not later than April 15, 1961. 7. Cancellation of contract In case of the Contractor's default during performance of the work, the Owner may cancel this Contract and all materials, parts and work performed still in the Contractor's yard shall become the property of the Owner at the price decided by negotiations between the Owner and the Contractor, but, in no case, to exceed the actual cost of all materials, parts and work and by the shipyard less progress payments. Any differences are to be settled under the Arbitration Clause of this Contract. Furthermore, in case any delay by the Contractor exceeding 60 calendar days for the scheduled delivery of the vessel and for any delay exceeding 15 calendar days after June 15, 1962 the Owner may declare the Contract to be in default. If the Owner should, for his own convenience, cancel this Contract, the Contractor will be entitled to reimbursement of all costs plus a profit of 10 (ten) percent. In computing such costs, the resale and/or scrap value of all materials shall be taken into consideration. The price shall be determined by negotiation between the Owner or his design agents and the Contractor. 8. Liquidating damages for delay in delivery In the event the Contractor fails to deliver the converted vessel on or before the agreed delivery date as provided by section 6, the Owner will suffer damages which are difficult of ascertainment, so that it is agreed by the Contractor and the Owner, the sum of $1,000.00 per calendar day represents liquidating damages due to the Owner for each calendar day's delay beyond fifteen days after the scheduled delivery of the converted vessel. Such an amount to be deducted from the Contract price. However, the Contractor shall not be charged with liquidating damages when delay in completion of the work is due to acts of God or public enemy, acts of the Government, fires, floods, epidemics, quarantine restrictions, strikes, freight embargoes and unusually severe weather. The Contractor promptly shall notify the Owner of such delay. The Owner shall thereupon ascertain the facts and the extent of the delay and extend the time for completion when he determines that the Contractor is entitled to such extension under the terms of this paragraph. 9. Instrument of payment Payment will be made in U.S. Dollars to the Contractor's account at the Banco Hispano Americano in Madrid, as follows: 90 Days after delivery of ex: "S.T. Esso Buffalo"Upon completion of vessel----- - $100,000 Balance in 6 equal monthly instalments after delivery of completed vessel. 10. Injury to employees and others-Damage to or loss of property The Contractor shall indemnify and save harmless the Owner and the vessel against all claims arising from injury to or death of employees, workmen, trespassers, licensees and all other persons whether in, or on, or about the contract work, or from damage to or loss of property of third parties due to the act, neglect or default of the Contractor, its employees, its subcontractors or their employees. It is agreed that the workmen and employees upon the contract work shall, at all times be employees of the Contractor or its subcontractors and shall not be the employees of the Owner. This agreement of the Contractor to indemnify and save harmless shall not apply to any injury to or death of any person, or to any damage to or loss of property of third parties, occurring, after the delivery to and the acceptance of the vessel by the Owner: Provided, however, That any death caused by an injury occurring before such delivery and acceptance due to the act, neglect of default of the Contractor, its employees, its subcontractors or their employees shall not be excluded from the indemnity provided for under this article for the reason of such death occurring after such delivery and acceptance. 11. Arbitration Any dispute arising under or by virtue of this Contract or any difference of opinion between the parties hereto concerning their rights and obligations under this Contract, shall be resolved by arbitration. Such arbitration proceedings shall take place in London, England. In the event that a dispute arises during construction concerning technical matters, and both parties agree that the amount involved is less than $10,000.00, then, in such event, the arbitration shall be held in the country of the shipyard; but any award in such arbitration shall not exceed $10,000.00. The party seeking arbitration shall notify the other party by mail of the name of its arbitrator and within fourteen (14) days after receipt of a request for arbitration, such party shall name its arbitrator. In the event the two (2) selected arbitrators cannot agree within fourteen (14) days on the selection of a third arbitrator, said third arbitrator shall be nominated by the President of the American Bureau of Shipping. The decision of any two arbitrators so selected shall be final and binding upon both parties. The arbitrators shall be bound by the provisions of this contract and specifications where applicable and shall have no authority to alter any of such provisions in any way. Arbitration costs shall be paid as directed. 12. Taxes The Contractor shall pay all local taxes, assessments, and duties assessed against the vessel and/or materials to be used in the performance of this contract prior to delivery to and acceptance of the converted vessel by the Owner. 13. Patents The Contractor shall be responsible for any and all claims against the Owner of the vessel for infringement of patents or of patent rights or for the use of patented articles in connection with the work and material furnished by the Contractor, whether the claim is made during or after the execution of this contract. 14. Guarantee period The Contractor shall guarantee all material, equipment and workmanship furnished by him for a period of six months after acceptance of the converted vessel by the Owner. Any defects arising during that time due to unsatisfactory material, workmanship, or operation shall be corrected at the contractor's expense. The Contractor is to assign manufacturers' standard guarantee to the Owner for the duration of the guarantee period. The cost paid will be the equivalent of prices of the repairs at the Contractors' yard. 15. Owner's representatives It is understood that the Owner may retain representatives for inspection in the shipyard. These representatives to be furnished with first-class offices, secretarial help and other facilities to enable thorough supervision of the construction to be carried out. 16. Documentation and certification Work to be done hereunder shall be in full accordance with the rules and regulations of the American Bureau of Shipping and the United States Coast Guard, and with those of such other regulatory bodies as are required by the Plans and Specifications. Promptly upon completion of the conversion, the Contractor shall obtain and deliver to the Owner a Certificate of Classification, American Bureau of Shipping, to the highest classification granted. 17. Brokerage commission The Contractor will pay Cargo Ships and Tankers Inc., 17 Battery Place, N.Y. 4, N.Y. USA a 21⁄2% (Two and one half) commission on the total conversion price. In witness whereof, the parties hereto have caused these presents to be executed on their behalf and their seals to be hereunto affixed and duly attested by their respective officers thereunto duly authorized, this second day of August of 1961, effective as of the date first above mentioned. OUTLINE SPECIFICATIONS FOR THE CONVERSION OF A TANKER INTO A BULK CARRIER JULY 1961 Prepared by Marine Architects, Inc., for Progressive Steamship Corp., (a) Intent New York, N.Y. It is the intent of these specifications to outline the work to be performed for the conversion of an 18,600-deadweight-ton tanker into a bulk carrier, suitable for the carriage of bulk cargoes such as grain, coal, or iron ore. |