United States v. City of Jacksonville, 12105.

• Decision Date: 31 May 1948
• Docket Number: No. 12105.,12105.
• Citation: 167 F.2d 366
• Parties: UNITED STATES v. CITY OF JACKSONVILLE, FLA., et al.
• Court: U.S. Court of Appeals — Fifth Circuit

167 F.2d 366 (1948)

UNITED STATES v. CITY OF JACKSONVILLE, FLA., et al.

No. 12105.

Circuit Court of Appeals, Fifth Circuit.

April 16, 1948.

Rehearing Denied May 31, 1948.

H. S. Phillips, U. S. Atty., of Tampa, Fla., and Arthur A. Simpson, Asst. U. S. Atty., of Jacksonville, Fla., for appellant.

Robt. R. Milam, of Jacksonville, Fla., for appellees.

Before SIBLEY, WALLER, and LEE, Circuit Judges.

SIBLEY, Circuit Judge.

The City of Jacksonville for about twenty years has owned and operated Municipal Docks and Terminals on the St. Johns River which include large interconnected storage tanks in which spirits of turpentine are warehoused for compensation on warehoused receipts issued to the depositors. The City itself has not bought and sold turpentine. In 1942 and 1943 the Commodity Credit Corporation for the United States deposited and withdrew millions of gallons of turpentine, becoming the City's principal customer. On September 6, 1944, its deposits were over 98 per cent of the total of 2,138,644 gallons represented by outstanding warehouse receipts. On September 5, 1944, there was discovered a serious leakage of turpentine through a corroded pipe connection in a waste pipe line, and the loss as determined by inventories taken September 7 and 23 compared with that of August 15, 1944, was prorated among all holders of warehouse receipts, the portion falling on the United States being reported to it as being 26,445 gallons. The City of Jacksonville thereafter refused on tender of the outstanding receipts to honor them to that extent, and the United States sued in the District Court to recover $20,795.72, the market value of the withheld turpentine. The City's answer admitted that the receipts were outstanding and that it had withheld the turpentine as alleged, and set up as its defense that the turpentine sued for was lost by a leakage not due to its negligence. A jury trial was demanded.

On the trial the above stated facts were undisputed. The warehouse receipts held by the United States were on a form prepared by it, and contained a clause that the warehouseman "will not be responsible for loss or damage by fire, the elements, leakage, or for other than ordinary care, or from other causes not due to its negligence." The contested fact issue, on which there was much evidence taken, was whether the leak, and the failure to find it more promptly, were without negligence on the part of the warehouseman. The evidence, however, further showed that in the storage tanks was carried turpentine in excess of outstanding receipts which had accumulated during the preceding fifteen years amounting in August, 1941, before the United States became a depositor, to 29,064 gallons. In August, 1944, just before the leakage, it was 30,553 gallons. The overage came from disregarding fractions of gallons in deposits and withdrawals, or errors in measurements by the official gaugers, or failures to adjust for temperature. By the custom of the business, the overage thus arising belongs to the warehouse, and similar deficiencies would be its loss. This warehouse had never sold any of its overage, but carried it as a sort of surplus. A relatively small part of it probably arose from the dealings with the United States. The total loss by leakage did not exhaust this overage. The United States moved for a directed verdict on the point of law that the leakage loss is chargeable against this overage and not against the outstanding receipts. The motion was denied. The court was requested to charge the jury the law to that effect, but it refused the request and charged as to this point: "The mere fact standing alone that there is an overage out there does not make the City of Jacksonville liable in this case. It stands on the contract. If the loss has been due to leakage and that leakage is the result of negligence, the City is liable. On the other hand, if the loss was due to leakage but the City has exercised all due care and caution, then the City is not liable." The only errors specified are the denial of the motion for directed verdict, the refusal to charge as requested, and the giving of the quoted charge.

1. Florida has a statute substantially like the Uniform Warehouse Receipts Act, Florida Statutes of 1941, Florida Statutes Annotated, Sec. 678.01 and following, and its terms govern. It provides for the commingling of fungibles: Sect. 678.23. Sect. 678.21 declares, "A warehouseman shall be liable for any loss or injury to the goods caused by his failure to exercise such care in regard to them as a reasonably careful owner of similar goods would exercise, but he shall not be liable, in the absence of an...