Weirton Steel Co. v. Isbrandtsen-Moller Co.

• Decision Date: 11 March 1942
• Docket Number: No. 154.,154.
• Citation: 126 F.2d 593
• Parties: WEIRTON STEEL CO. v. ISBRANDTSEN-MOLLER CO., Inc.
• Court: U.S. Court of Appeals — Second Circuit

126 F.2d 593 (1942)

WEIRTON STEEL CO. v. ISBRANDTSEN-MOLLER CO., Inc.

No. 154.

Circuit Court of Appeals, Second Circuit.

March 11, 1942.

Herbert M. Statt and Haight, Griffin, Deming & Gardner, all of New York City (Edward H. Mahla, of New York City, of counsel), for appellant.

F. Herbert Prem and Bigham, Englar, Jones & Houston, all of New York City, for appellee.

Before L. HAND, CHASE, and CLARK, Circuit Judges.

L. HAND, Circuit Judge.

This appeal concerns only the proper rule of damages to compensate the libellant for injury to a parcel of tin plate while on board the respondent's vessel on a voyage from Baltimore to Hong Kong. At the outturn 2,701 cases out of a total of 6,043 were found to have been damaged by "liquefied resin." The consignee, the Texas Company, at first declared that it would abandon these cases, but it accepted them after it had made a settlement with its underwriter, which paid $10,117.26 for the damage done. The parties have agreed that the respondent shall bear 85% of whatever the loss may be proved. The libellant is the shipper, but the party actually interested is the underwriter. The evidence was documentary except for two depositions taken by the libellant, of which the only one of importance was that of one Anderson, a surveyor of the Texas Company. After agreeing to keep the damaged plates, the Texas Company reconditioned them so far as possible, and after making them into five gallon oil cans, it sold them full of oil in due course. The reconditioning left the plates dull and imperfect in appearance, but the libellant did not prove whether these blemishes compelled the Texas Company to abate any part of the full market price either on sale or later, or whether they resulted in any returns. It may, however, be taken as true that it would have been not only costly, but impractical, to keep records showing what was the difference, if any, between the sale prices of the damaged cans and the sound ones. Out of 656,258 five gallon cans manufactured at the Texas Company's Hong Kong plant, 283,580 were made from the reconditioned plates. Anderson swore to what it had cost him to recondition a number of the plates and from this experience he concluded that to recondition all those damaged would have cost 42% of their sound value, which he assumed to be the same as the amount of the invoice. Moreover, since the plates when reconditioned were not as good as new, he consulted certain Chinese merchants in Hong Kong who advised him that they would pay only 48% of the value of the damaged plates as they were, i.e., not reconditioned. From this information and his own experience he computed the total damage at 52% of the invoice value of the goods. (It is not apparent just what connection the libellant sees between the reconditioning charges and this discount for depreciation demanded by the Chinese merchants; but we may assume that one is supposed to confirm the other.) The Texas Company's actual cost of reconditioning was only $1,073.59, but it did not appear how the cans compared in appearance with those plates which Anderson had personally reconditioned. The respondent argues that the recovery should be limited to 85% of the Texas Company's cost of reconditioning; or if not, then to that sum, plus 85% of 10% of the invoice value as a depreciation allowance. The judge entered a decree for the libellant's claim, 85% of $10,117.26.

The ordinary rule is indeed that damages for injury to goods while in possession of a carrier are to be computed at the difference between the sound market value at destination and the value as damaged. Chicago, M. & St. P. R. Co. v. McCaull-Dinsmore Co., 253 U.S. 97, 100, 40 S.Ct. 504, 64 L.Ed. 801; St. Johns N. F. Shipping Corp. v. S. A. Companhia, etc., 263 U.S. 119, 125, 44 S.Ct. 30, 68 L.Ed. 201. That...