Kirno Hill Corp. v. Holt

• Decision Date: 31 March 1980
• Docket Number: 720,Nos. 621,D,s. 621
• Citation: 618 F.2d 982
• Parties: KIRNO HILL CORPORATION, Plaintiff-Appellee-Appellant, v. Thomas J. HOLT, Defendant-Appellant, Holt Hauling & Warehousing Systems, Inc., Defendant, and Holt Marine Terminal, Inc., Defendant-Appellee. ockets 79-7694, 79-7695.
• Court: U.S. Court of Appeals — Second Circuit

Page 982

618 F.2d 982

KIRNO HILL CORPORATION, Plaintiff-Appellee-Appellant, v. Thomas J. HOLT, Defendant-Appellant Holt Hauling & Warehousing Systems, Inc., Defendant and Holt Marine Terminal, Inc., Defendant-Appellee.

Nos. 621, 720, Dockets 79-7694, 79-7695.

United States Court of Appeals Second Circuit.

Argued Jan. 9, 1980.

Decided March 31, 1980.

Donald B. Allen, New York City (Cichanowicz & Callan, Michael J. Carcich, New York City, of counsel), for plaintiff-appellee-appellant Kirno Hill Corporation.

John H. Gross, New York City (Anderson Russell Kill & Olick, P. C., Nicholas J. Zoogman, New York City, of counsel), for defendant-appellee Thomas J. Holt.

Before LUMBARD, MOORE and MESKILL, Circuit Judges.

PER CURIAM:

Thomas Holt and Kirno Hill Corporation both appeal from a judgment entered by Judge Weinfeld in the Southern District of New York on August 10, 1979. Holt claims that the district court erred in holding him personally liable to Kirno Hill, a shipowner, for charter-hire payments and other expenses. Kirno Hill claims that the district court erred in holding not liable for those payments and expenses two corporations that Holt controls: Holt Hauling & Warehousing Systems, Inc. (Holt Hauling) and Holt Marine Terminal, Inc. (Holt Marine). We conclude that the district court erred only as to the liability of Holt. We therefore reverse that portion of the judgment which holds Holt personally liable, and we affirm the judgment as to Holt Hauling and Holt Marine.

On August 22, 1975, Kirno Hill signed a charter party with Waterside Ocean Navigation, Inc., a New York corporation (hereinafter Waterside-New York), for the time charter of the M. S. Selene, one of Kirno Hill's vessels; and on September 9, Kirno Hill delivered the Selene to Waterside-New York for a voyage from the Gulf of Mexico to the Red Sea and Persian Gulf. The charter-hire payment that was due on December 9, 1975, was not made, however, and on December 29, the Selene's representative, Lamorte, Burns & Co., demanded payment from Waterside-New York. Jon Pendleton, Waterside-New York's president, replied on January 13, 1976, that Waterside-New York had not made any of the past charter-hire payments and would not make the defaulted payment because it had acted, when negotiating and executing the charter party, as the agent of another Waterside Ocean Navigation, Inc., this one a Pennsylvania corporation (hereinafter Waterside-Pennsylvania) whose sole owner is Holt. Pendleton's reply concluded, "It is suggested that the owner of the M. V. (sic) Selene look to MR. T. J. HOLT and his various companies for monies to complete the voyage entered into under the above referenced Charter Party."

On January 23, 1976, Kirno Hill filed a complaint against Holt, Holt Hauling, and Holt Marine, seeking unpaid charter-hire payments and the expenses it incurred in completing the Selene's voyage and discharging her cargo. ¹ Kirno Hill sought to prove that Holt was the undisclosed principal of Waterside-New York and was therefore liable under the principles of agency, and that Holt Hauling and Holt Marine were either additional undisclosed principals or were beneficiaries of Kirno Hill's performance of the charter party and were therefore liable under an unjust enrichment theory. Kirno Hill did not sue Waterside-Pennsylvania, which Holt had incorporated on August 11, 1975, for the business of chartering vessels.

The district court found that in July 1975 Holt engaged Pendleton, whose Waterside-New York is in the business of securing shipping principals, to find a vessel for charter to carry cargo. Pendleton found the Selene, negotiated its charter, and on August 22 signed the charter party. However, Waterside-New York forwarded to Waterside-Pennsylvania the communications from Kirno Hill that set forth the balances due under the charter party, and Waterside-Pennsylvania made the payments. Waterside-Pennsylvania received payments made for the carriage of goods aboard the Selene. Also, Waterside-Pennsylvania obtained financing from The First Pennsylvania Bank for the express purpose of chartering vessels, and in October paid $12,243.75 to Waterside-New York in commissions.

As to Holt Hauling and Holt Marine, which are in the business of trucking, stevedoring, and warehousing cargoes intended for foreign shipment, the district court found that Holt used their credit to guarantee the loans made to Waterside-Pennsylvania, that the companies shared common offices with Waterside-Pennsylvania, and that they received cash advances from Waterside-Pennsylvania. Kirno Hill did not, however, establish the occasion or terms of those advances. The district court also found that Kirno Hill did not know of the existence of Holt, Holt Hauling, or Holt Marine, when it signed the charter party.

Neither Holt nor Kirno Hill disputes the district court's findings. Holt disputes only the court's conclusion that "the evidence overwhelmingly establishes that in fact Thomas Holt was the charterer of the vessel, M. S. Selene, and that Waterside-New York acted as his agent in that transaction, all of which was unknown to the plaintiff." Kirno Hill disputes the court's conclusion that the evidence fails to show that Holt Hauling or Holt Marine...