Dietrich v. United States Shipping Board EF Corp., 164.

• Decision Date: 10 August 1925
• Docket Number: No. 164.,164.
• Citation: 9 F.2d 733
• Parties: DIETRICH v. UNITED STATES SHIPPING BOARD EMERGENCY FLEET CORPORATION.
• Court: U.S. Court of Appeals — Second Circuit

9 F.2d 733 (1925)

DIETRICH v. UNITED STATES SHIPPING BOARD EMERGENCY FLEET CORPORATION.

No. 164.

Circuit Court of Appeals, Second Circuit.

August 10, 1925.

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Neil P. Cullom, of New York City, for plaintiff in error.

Ralph C. Greene, U. S. Atty., of Brooklyn, N. Y. (Edgar C. Wandless, of New York City, Franklin W. Morton, of Brooklyn, N. Y., and Charles E. Wythe, of New York City, Sp. Asst. U. S. Attys., of counsel), for defendant in error.

Before ROGERS, MANTON, and HAND, Circuit Judges.

ROGERS, Circuit Judge (after stating the facts as above).

This is an action brought to recover damages alleged to have been sustained by plaintiff by reason of depreciation in value and loss of market of a shipment of flour laden on board the steamship Panola, due to delay in delivery at the port of destination. It is alleged in the complaint that the plaintiff delivered on August 31, 1921, to defendant, a common carrier, certain sacks of flour in good order and condition; that the flour was to be carried by the steamship Panola from Philadelphia, Pa., to Helsingfors, Finland; that defendant represented that the steamship would sail from Philadelphia on or about September 5, 1921, and would carry the flour with reasonable dispatch, and safely deliver the same to plaintiff or its order; that it did not carry and deliver the same with reasonable dispatch, but contrary to its agreement deviated from its voyage by first proceeding to the port of New York, where it remained until September 30, 1921, and then returned to Philadelphia and remained there until October 5, 1921; and that it so negligently and wrongfully prolonged the duration of the voyage as to cause injury and damage to plaintiff through depreciation in value and loss of market.

The original answer, duly verified by defendant's agent, admitted the delivery by plaintiff to defendant of the merchandise in question and defendant's agreement to carry said property to destination with reasonable dispatch, and there to deliver same as consigned; otherwise, the answer was a general denial. It was filed on May 3, 1923; but on August 3, 1923, defendant amended its answer, and denied the facts it had admitted in the original answer, along with the remaining allegations of the complaint.

On the trial plaintiff produced the bills of lading issued by the Susquehanna Steamship Company. It then offered in evidence the operating agreement under which the Susquehanna Steamship Company operated the steamship Panola for defendant's account, which agreement, it was conceded, was in force and effect during all the times involved herein. It was also conceded that the steamship Panola was one of the vessels assigned to the Susquehanna Steamship Company under the operating agreement. It was stipulated on the trial that the Panola, after receiving plaintiff's merchandise on board, instead of proceeding to her port of destination — Helsingfors, Finland — remained from August 31, 1921, to September 8, 1921, at Philadelphia, when she sailed to New York, and there remained until September 30, 1921, returned to Philadelphia on or about said date, and remained there until October 5, 1921, on which latter date she proceeded to her destination, where she arrived on November 15, 1921.

The general freight agent of the Susquehanna Steamship Company testified that he was thoroughly familiar with the facts and circumstances surrounding the operation of the ship in question, that "the steamship Panola was operated under what is known as the MO-4 agreement. Under the MO-4 agreement the Shipping Board was fully advised as to just what we were doing, and they were at all times kept posted." The witness further testified as follows:

"Her stay at New York was due to the fact that at that particular time there was one of the Shipping Board operators eliminated from the Scandinavian territory, and there was a general mix-up of cargo, and a rehandling of cargo there between the operators.

"Q. Prior to this time, is it a fact that the Shipping Board had two lines to the Baltic ports? A. Three.

"Q. What were they? A. Moore & McCormack, the Susquehanna Steamship Company, and the Seager Steamship Company.

"Q. You stated a moment ago, I believe, that this detention at New York was due to the fact of the elimination of one of those lines by the Shipping Board. Is that correct? A. Yes, sir.

"Q. Which line was eliminated by the Shipping Board? A. The Seager Steamship Company."

The witness further testified that the Susquehanna Company rendered daily written reports to defendant of the operation of the ship, but defendant refused upon demand to produce these reports. Defendant's traffic department had full control of the movements of the ships.

Plaintiff's export manager, John W. Craig, testified that the normal running time between Philadelphia and Helsingfors at this time was from 21 to 26 days, and that the difference between the market values on the date when the ship should have arrived and the date of actual arrival, with interest, was $4,238.15. The witness further testified that he had not been advised by defendant or any of its representatives of the proposed delay in the ship's departure, and that the movements of this particular vessel were "quite unusual."

Plaintiff rested, and defendant moved to dismiss the complaint, on the ground that there was no "privity of contract between plaintiff and defendant." The court granted the motion over plaintiff's exception, on the ground that the ship and the owner would be liable to plaintiff, but that defendant in the case at bar was not, and owed no duty or obligation to plaintiff.

The complaint was dismissed because the plaintiff had failed to establish any liability on the part of the defendant. The action was brought solely against the United States Shipping Board Emergency Fleet Corporation. The plaintiff introduced in evidence an agreement dated January 4, 1921, and which is known as "the MO-4 agreement." This agreement is thus entitled:

"United States Shipping Board,

"Represented by United States Shipping Board Emergency Fleet Corporation, Washington."

It then states:

"This agreement, made in duplicate the 4th day of January, 1921, between the United States of America, acting through the United States Shipping Board, represented by the United States Shipping Board Emergency Fleet Corporation, hereinafter called the corporation, and Susquehanna Steamship Company, hereinafter called the agent."

At the conclusion of the agreement it is recited as follows:

"In witness whereof, the parties hereto have executed this contract, in duplicate, the day and year first above written. United States of America, by United States Shipping Board, by United States Shipping Board Emergency Fleet Corporation, by Signed W. S. Benson, President. Attest: Signed John J. Flaherty, Secretary. Susquehanna Steamship Co., Inc., Signed Jos. D. Phillips, Vice Prest., by Signed Joseph G. Stockham, Secretary, Agent."

It is apparent that the United States of America and the Susquehanna Steamship Company are parties to this contract. We also think it apparent that the intention was that the United States Shipping Board, the Emergency Fleet Corporation were also intended to be parties.

In Sloan Shipyards Corporation v. United

States Shipping Board Emergency Fleet Corporation, 258 U. S. 549, 42 S. Ct. 386, 66 L. Ed. 762, an action was brought against the defendant in the present suit, and as in this case the action was based on an alleged breach of contract. In that case the contract was made with the Fleet Corporation, "representing the United States of America." The Supreme Court, in holding that the action could be maintained against the Fleet Corporation, said: "We attach no importance to the fact that the second contract, alleged to have been illegally extorted, was made with the Fleet Corporation `representing the United States of America.' The Fleet Corporation was the contractor, even if the added words had any secondary effect." And the court held that the Fleet Corporation, notwithstanding the enormous powers which had been given to it, was not so far put in place of the sovereign as to share the immunity of the sovereign from suit, otherwise than as the sovereign allowed.

It is a general principle of law that, if an agent acts within the scope of his actual or apparent authority and enters into a contract on behalf of his principal, the contract is that of the latter. All the rights and obligations which arise under it are those of the principal, and the agent cannot enforce the contract, neither is he bound by it. Williston on Contracts, vol. 1, § 281.

While the general rule is as above stated, it is possible for the agent to bind himself by the contract, although the contract discloses the name of his principal. If the name of the principal is disclosed, there is a strong presumption that the contract was intended to be that of the principal, and not that of the agent. But the rule is simply one of presumption. Williston on Contracts, supra. In Whitney v. Wyman, 101 U. S. 392, 396 (25 L. Ed. 1050), the court said:

"As the meaning of the lawmakers is the law, so the meaning of the contracting parties is the agreement. Words are merely the symbols they employ to manifest their purpose, that it may be carried into execution. If the contract be unsealed and the meaning clear, it matters not how it is phrased, nor how it is signed, whether by the agent for the principal, or with the name of the principal by the agent, or otherwise. The intent developed is alone material, and when that is ascertained it is conclusive Where the principal is disclosed, and the agent is known to be acting as such, the latter cannot be made personally liable, unless he agreed to be so."

If the meaning of the contracting parties is the agreement, and it matters not how it is phrased or how it is signed,...