(e) In case of the violation of this section or of any of the regula tions issued thereunder by any vessel, or any owner or officer thereof, such vessel, owner, or officer shall be fined not more than $1,000, and such owner or officer may be imprisoned for not more than one year, or subjected to both fine and imprisonment. Should the owner of such vessel be a corporation, organization, or association, each officer or director participating in the violation shall be liable to the penalty hereinabove prescribed.

SEC. 4. The provisions of section 3 of this Act shall not apply to vessels of the Navy or the Coast Guard used by or in connection with civilian nautical schools.

Approved, June 12, 1940.

[CHAPTER 358-3D SESSION]
[H. R. 5584]

AN ACT

To amend the Canal Zone Code.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That section 10 of title 2 of the Canal Zone Code, approved June 19, 1934, is amended so as to read as follows:

“10. INJURIES TO VESSELS, CARGO, CREW, OR PASSENGERS, OCCASIONED BY OPERATION OF CANAL.-The regulations of the President, authorized under section 9 of this title, shall provide for the prompt adjustment and payment by the Governor of the Panama Canal, subject to the limitations hereinafter contained in this section, of damages for injuries to vessels, or to the cargo, crew, or passengers of vessels, which may arise:

"(a) By reason of the passage of such vessels through the locks of the canal under the control of officers or employees of the Panama Canal: Provided, however, That no such damages shall be paid in any case wherein the Governor shall find that the injury was proximately caused by the negligence or fault of the vessel, master, crew, or passengers: And provided further, That in any case wherein the Governor shall find that the negligence or fault of the vessel, master, crew, or passengers proximately contributed to the injury, he shall diminish the award of damages in proportion to the negligence or fault, as determined by him, attributable to the said vessel, master, or passengers.

crew,

"(b) By reason of the presence of such vessels in the waters of the Canal Zone, other than the locks, when the Governor shall find that the injury was proximately caused by negligence or fault on the part of any officer or employee of the Panama Canal acting within the scope of his employment and in the line of his duties in connection with the operation of the canal: Provided, however, That when the Governor shall further find that the negligence or fault of the vessel, master, crew, or passengers proximately contributed to the injury, he shall diminish the award of damages in proportion to the negligence or fault, as determined by him, attributable to the said vessel, master, crew, or passengers: And provided further, That, in the case of any vessel which is required by or pursuant to regulations heretofore or hereafter prescribed under section 9 of this title to have a Panama Canal pilot on duty aboard, no damages shall be adjusted and paid for injuries to any such vessel, or to the cargo or passengers of any such vessel, incurred while the vessel is under way and in motion, unless at the time such injuries are incurred the navigation or movement of the vessel is under the control of a Panama Canal pilot.

"The amounts of the respective awards of damages, under this section and the regulations authorized herein, may be adjusted, fixed, and determined by the Governor by mutual agreement, compromise, or otherwise, and such amounts shall be payable promptly out of any moneys appropriated or allotted for the maintenance and operation of the Panama Canal, and acceptance by any claimant of the amount awarded to him shall be deemed to be in full settlement of such claim against the Government of the United States: Provided, however, That the Governor shall not adjust and pay any claim for damages for injuries arising by reason of the presence of a vessel in the waters of the Canal Zone, other than the locks, where the amount of the claim exceeds $60,000, but shall submit the same to the Congress by a special report containing the material facts and his recommendations thereon.

"With respect to any claim for damages for injuries arising by reason of the passage of any vessel through the locks of the canal, as hereinbefore provided, any claimant for damages who considers himself aggrieved by the findings, determination, or award of the Governor, in reference to his claim, may bring an action on such claim against the Panama Canal in the United States District Court for the District of the Canal Zone; and in any such action the provisions of this section, and of the regulations of the President authorized under section 9 of this title, applicable to the determination, adjustment, and payment of such claims for damages, by the Governor, shall be applicable, and any judgment obtained against the Panama Canal shall be paid promptly out of any moneys appropriated or allotted for the maintenance and operation of the Panama Canal. "Except as otherwise provided in the next preceding paragraph of this section, no action for damages for injuries arising in connection with the operation of the Canal and by reason of the presence of a vessel in the waters of the Canal Zone shall lie in any court against the United States or the Panama Canal, or against any officer or employee of the Panama Canal: Provided, however, That nothing in this section shall be construed to prevent or prohibit actions against officers or employees of the Panama Canal for damages for injuries resulting from acts of such officers or employees outside the scope of their employment and not in line with their duties, or from acts of such officers or employees committed or performed with intent to injure the person or property of another."

SEC. 2. That chapter 14 of title 2 of the Canal Zone Code, which chapter now consists of sections 271 to 275 of said title 2, is hereby amended so as to read as follows:

"271. MAINTENANCE AND OPERATION OF THE CANAL ZONE POSTAL SERVICE.-The Postal Service of the Canal Zone shall be governed, except as otherwise provided in the Canal Zone Code, by such of the laws, rules, regulations, and conventions of the Postal Service of the United States as by their terms apply in the Canal Zone and by such additional laws, rules, and regulations of the Postal Service of the United States as the Governor of the Panama Canal shall by regulation determine to be applicable to conditions existing in the Canal Zone. The Governor may prescribe such additional rules and regulations as are necessary for the maintenance and operation of the

"The Governor of the Panama Canal is authorized

"a. To maintain and operate a postal service in the Canal Zone, including a money-order system, a parcel-post system, a postal-savings system, and such other services as may be necessary or convenient in connection with the postal service;

"b. To establish and discontinue post offices;

"c. To prescribe the postage rates: Provided, however, That the United States domestic postage rates shall be applicable to regular mail exchanged with the United States; and

"d. To prescribe the postage stamps and other stamped paper which shall be used in such service.

CROSS REFERENCES

Extension to Canal Zone of United States laws and regulations defining crimes against the postal service, see title 5, section 111.

For the laws of the Postal Service of the United States, see U. S. Code, title 39.

"272. DEFRAYING EXPENSES FROM REVENUE SO FAR AS POSSIBLE.-The expenses of operating the Canal Zone postal service shall be defrayed, so far as possible, from the revenue derived therefrom, the use of which for that purpose is authorized.

"273. ACCEPTANCE OF POSTAL-SAVINGS DEPOSITS.-Such of the post offices of the Canal Zone as may be designated by the Governor are hereby authorized, under such regulations as the Governor may prescribe, to receive postal-savings deposits, and to issue therefor postal-savings certificates in the form to be prescribed by the Governor.

"274. RATE OF INTEREST ON POSTAL-SAVINGS CERTIFICATES.-Postalsavings certificates issued as provided in this chapter shall bear interest at such rate, not exceeding 3 per centum per annum, as shall be established by the President.

"275. FAITH OF UNITED STATES PLEDGED TO PAYMENT OF DEPOSITS.The faith of the United States is pledged to the payment of postalsavings certificates issued as provided in this chapter, with accrued interest thereon, in the same manner as such faith is pledged by law with respect to deposits made in postal-savings depository offices in the United States.

"276. CONTROL OF MONEY-ORDER AND POSTAL-SAVINGS FUNDS.-The funds received from the issuance of money orders and postal-savings certificates by the Canal Zone postal service shall be under the control of the Governor.

"277. DEPOSIT OF MONEY-ORDER AND POSTAL-SAVINGS FUNDS IN UNITED STATES TREASURY.-The Governor is authorized to cause to be deposited in the United States Treasury for safekeeping but subject to his control all or any part of the funds, including interest thereon, received from the issuance of money orders and postalsavings certificates, and such funds or any part thereof may be withdrawn from time to time under such regulations as may be prescribed by the Governor.

"278. DEPOSIT OF MONEY-ORDER AND POSTAL-SAVINGS FUNDS IN BANKS; SECURITY.-The Secretary of the Treasury is hereby authorized to

tories, under such regulations as may be prescribed by him, of funds received from the issuance of money orders and postal-savings_certificates, including interest therefrom, and is hereby directed to require the associations thus designated to give satisfactory security, by the deposit of United States bonds or otherwise, for the safekeeping and prompt payment of the funds deposited with them, and such associations are authorized to give such security as may be required. All pledges of securities heretofore made for the safekeeping and prompt payment of any such funds are hereby ratified, approved, and validated.

279. INVESTMENT OF MONEY-ORDER AND POSTAL-SAVINGS FUNDS IN SECURITIES OF THE UNITED STATES.-The Governor is hereby authorized to invest all or any part of the funds referred to in the two preceding sections in bonds or other securities of the United States and to deposit such securities with the Treasurer of the United States for safekeeping, and to sell such securities, or any part of them, when such sale is necessary or desirable in the interest of the postal service. Before making such purchases or sales of securities, the Governor shall request the advice of the Secretary of the Treasury.

"280. USE OF INTEREST AND PROFITS ON MONEY-ORDER AND POSTAL SAVINGS FUNDS.-The interest and profits received from the deposit in banks or the investment, as provided in this chapter, of moneyorder and postal-savings funds shall form a part of the Canal Zone postal revenues and shall be available to pay the interest on postalsavings certificates, the expenses of operating the Canal Zone postal service, and the losses which are chargeable to the said service.

"281. APPLICATION OF FOREGOING PROVISIONS TO DEPOSIT MONEY ORDERS.-All the provisions of this chapter relating to postal-savings certificates and the funds received therefrom, including interest, shall apply equally to money orders issued in lieu of postal-savings certificates prior to the effective date of this Act, and to the funds received therefrom, including interest."

SEC. 3. That section 843 of title 5 of the Canal Zone Code is amended so as to read as follows:

"843. PLACING SIGNS ON LANDS OR STRUCTURES IN CANAL ZONE.The Governor of the Panama Canal is hereby authorized to make rules and regulations in respect to the construction or placing of signs, bills, posters, or other advertising devices on any lands, buildings, or other structures in the Canal Zone. Any person who shall violate any provision of such rules and regulations shall be punished by a fine of not more than $25, or by imprisonment in jail for not more than ten days, or by both; and every day that any such advertising device shall remain upon such lands or structures, in violation of such rules and regulations, shall constitute a separate offense."

SEC. 4. That section 125 of title 6 of the Canal Zone Code is amended so as to read as follows:

"125. PROCEEDINGS ON PLEA OF GUILTY.-If the defendant pleads guilty, the magistrate may hear testimony to determine the gravity of the offense and, within twenty-four hours after such plea or hearing of testimony, shall render judgment as to the punishment to be