COMPAGNIE De NAVIGATION, ETC. v. Mondial United Corp.

Citation316 F.2d 163
Decision Date04 April 1963
Docket NumberNo. 19695.,19695.
PartiesCOMPAGNIE De NAVIGATION FRAISSINET & CYPRIEN FABRE, S. A. and S. S. ALLOBROGIA, Appellants, v. MONDIAL UNITED CORPORATION, Appellee. MONDIAL UNITED CORPORATION, Appellant, v. S. S. EXMOOR, her engines, etc., and Compagnie De Navigation Fraissinet & Cyprien Fabre, S. A., Appellees.
CourtUnited States Courts of Appeals. United States Court of Appeals (5th Circuit)

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Frank J. Marston, Scott, McCarthy, Preston & Steel, Miami, Fla., for appellant S. S. Allobrogia.

Talbot D'Alemberte, Fowler, White, Gillen, Humkey & Trenam, Miami, Fla., for appellant Compagnie de Navigation Fraissinet et Cyprien Fabre, S. A.

Dwight Sullivan, James A. Dixon, Jr., Dixon, DeJarnette, Bradford, Williams, McKay & Kimbrell, Miami, Fla., for appellee Mondial United Corp.

Before BROWN, GEWIN and BELL, Circuit Judges.

JOHN R. BROWN, Circuit Judge.

This appeal and cross appeal from admiralty decrees allowing recovery for cargo damage presents five principal questions. The first is whether the evidence is sufficient to sustain cargo's burden and the finding of Carrier fault. The second, as to both appeal and cross appeal, relates to the computation of damages, and the third to mitigation of damages. The fourth concerns the standing of the libelant corporation to recover since it was not the shipper or consignee as such. And fifth is the question whether, as to one of the two vessels involved, the decree for cargo should have run against the vessel owner as well as the charterer-carrier.

Brought as two separate libels, they were properly consolidated for trial and appeal. Recovery was sought for damage to Italian window glass caused largely by stain from moisture. Four separate shipments moved under four bills of lading. Two shipments of 256 crates were on the SS EXMOOR and two of 325 crates on the SS ALLOBROGIA. Each of the two libels was in personam against the Fabre Line1 and in rem against the particular vessel.2 The shipments on the SS ALLOBROGIA were received by Fabre Line at Leghorn, Italy, March 18, 1960, those on the EXMOOR February 24-25, 1960, for carriage to Port Everglades, Florida.

On the trial the Judge saw and heard all of the witnesses. This included those who testified concerning the condition of the cargo on outturn, the nature and extent of the damage, and the dollar valuation thereof. On this record he concluded that the cargo had sustained its burden of proving damage for which the Carrier was responsible. The libelant did not undertake to offer extraneous evidence on the actual nature of the goods at the time of delivery to the Carrier in Italy. It was content to rely upon clean bills of lading3 which, the Court found, acknowledged the receipt of the goods by "the carrier and ship in good order and condition" and "with no exceptions".

Starting with this premise, the Court on the basis of the evidence offered then found that on discharge from each of the vessels, the cargo was "in a condition inconsistent with the apparent good order when loaded." On outturn "many of the crates were twisted, some had broken boards, and the majority were stained and discolored, and in some it was easily discernible * * * that the contents were damaged * * *." Port Everglades Terminal Company, acting apparently as stevedore and certainly as agents for Fabre Line, noted certain exceptions to the cases of glass on discharge. Exception was taken, the Court found, to "staining, mold, moisture, twisting and breaking." Formal written notice of damage was given by the Consignee on the date of delivery of the SS EXMOOR shipments, and within three days as to one of the ALLOBROGIA shipments. Notice as to the remaining shipment was sent within 18 days.4 Thereafter joint surveys were held by surveyors representing the consignee and the Carrier. These surveyors were in substantial agreement as to the nature and extent of damage, and there is no suggestion in the record that the damage as found by them initially occurred between date of discharge from the vessel and the survey.5 A small amount of the damage resulted from some of the glass being broken or shattered within the cases. The principal damage, however, was stain from moisture. Some of the glass was so badly stained that it had to be discarded as unmarketable or the stain cut and trimmed away. Of that not yet stained, much of it was moist requiring extensive steps to unpack, dry and clean the glass.

In effect the Carrier6 contends that all the libelant proved was that the goods were delivered in bad condition. And this, it continues, is insufficient since there was no evidence showing receipt by the Carrier in good condition. This is based on the fact that the recitations in the clean bills of lading purported to state the apparent condition of the cargo which was, however, restricted to the external wooden cases. With contents of the cases concealed, the Carrier could not have made representations as to the condition of the glass.

We agree with the Carrier that this is the crucial issue on the appeal. The damaged condition on outturn was overwhelmingly established. And there was more than ample evidence to justify the Court's inference that this was attributable to conditions arising during water transportation. In this latter respect, the record is more favorable to cargo than it would have to be. For assuming good order on receipt and bad order on outturn, the burden was then on the Carrier to show that the damage was brought about by an excepted cause. Here the only two remotely helpful to the Carrier were those found in § 1304 of C.O.G.S.A., (c) perils of the sea and possible (m) inherent vice or defect of the goods. This was based largely on the assumptions expressed by all of the experts that the most likely source of the excess moisture on the glass plates was sweating resulting inevitably from air striking surfaces during temperature and humidity changes. But to show this as an excepted peril, the Carrier in effect has to absolve itself from negligence by showing that despite prompt, timely, prudent and adequate steps in ventilation and protective measures, the sweating nontheless occurred from the inescapable conditions of ocean carriage.7

The Carrier's proof did not begin to suggest even the slightest suspicion of a whisper of a possible exoneration. Not a single ship's officer was proffered as a witness either by deposition or in court. The vessel's logbooks, despite the Court's order to do so, were never produced. And the damage on the SS EXMOOR — comprising as it does 75% of the total dollar claimed — was traced even closer to active carrier fault from improper stowage near or with granite chips which either were, or had been allowed to become, wet.

Of course it was the Carrier's lawful right to put the libelant to its proof and for its defense stand upon the insufficiency of evidence of delivery of the cargo to the Carrier in good order and condition. Prevailing on that score, proof by the Carrier on actual care and custody of the goods would have been superfluous. The course, however, was a risky one and had its own particular perils, as its able proctors well knew. And the entire want of any evidence remotely suggesting that the cargo was properly cared for while in Carrier's custody is itself a factor which the Judge was entitled to credit.8 This factor was significant as the Judge undertook to evaluate the evidence which had been offered and which showed that proof of apparent external good order and condition was an adequate basis for inferring good order and condition of the contents.

This evidence came from an executive of the consignee who was experienced in the shipment, handling, storage, and distribution of imported glass, including the manner in which it was packaged and tendered for shipment in Italy. He testified that had the glass sheets in the cases been covered with moisture as they were on outturn, the external appearance of the wooden cases at time of shipment would have been similar to that revealed on discharge. This would have been, he stated, especially true as to extensive staining and discoloration of the wooden cases. Adding substance to this view was the record proof showing that hundreds of thousands of feet of glass was carried and imported with but slight moisture damage of this kind.

Whether a particular type of damage is such as to produce the external appearances found on discharge thus giving rise in turn to an inference that such damage was nonexistent at the time of loading is, by its very nature, a question of fact. Reider v. Thompson, 5 Cir., 1952, 197 F.2d 158, 161. Where because of the perishable or intrinsic nature of the commodity, the internal condition is not adequately revealed by external appearances, cargo may have a considerable burden of going further to prove actual condition.9 But here the proof from a knowledgeable source was substantially uncontradicted. Not even the ship's surveyor ventured to deny this factual statement or to suggest that the existence at time of shipment of the extensive moisture of the kind found on outturn would not have been revealed through stains and damage to the cases. Indeed, about all he attempted to do was to assert two things. The first was that staining and discoloration might have come from sap or moisture in the wood itself, and therefore condition of contents was not necessarily indicated by external appearances. The second was that the moisture undoubtedly resulted from sweating. But this latter point was neither revealing nor legally significant unless his principal was to go forward with proof of due care in the prevention of this particular sea peril. (See note 7, supra)

On the liability phase the case was the classic one of a fact resolution by the Judge that the cargo was in good condition on receipt and in bad order on delivery. In the void which the Carrier's absolute silence...

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