Artemis Maritime Co. v. Southwestern Sugar & M. Co.

• Decision Date: 11 May 1951
• Docket Number: No. 6203.,6203.
• Citation: 189 F.2d 488
• Parties: ARTEMIS MARITIME CO., Inc., et al. v. SOUTHWESTERN SUGAR & MOLASSES CO., Inc. THE DEMOSTHENES.
• Court: U.S. Court of Appeals — Fourth Circuit

189 F.2d 488 (1951)

ARTEMIS MARITIME CO., Inc., et al. v. SOUTHWESTERN SUGAR & MOLASSES CO., Inc. THE DEMOSTHENES.

No. 6203.

United States Court of Appeals Fourth Circuit.

Argued April 4, 1951.

Decided May 11, 1951.

Thomas M. Johnston and Leon T. Seawell, Norfolk, Va., for appellants.

George L. Varian, New York City (John W. Oast, Jr., Norfolk, Va., and Crowell & Rouse, New York City, on brief), for appellee.

Before PARKER, Chief Judge, and SOPER and DOBIE, Circuit Judges.

DOBIE, Circuit Judge.

Southwestern Sugar and Molasses Company, Inc., (hereinafter called Southwestern) brought a libel in admiralty, in the United States District Court for the Eastern District of Virginia, against the Panamanian Steam Tanker Demosthenes and the Artemis Maritime Company, Inc., (hereinafter called Artemis), her owner. Southwestern sought to recover damages for alleged loss due to contamination of certain molasses, the value of a part of the cargo of molasses, which had been jettisoned and a refund of portions of the freight charges paid by Southwestern to Artemis.

The District Court, after hearing the evidence, rendered an opinion concluding that Southwestern should recover the damages it sustained by reason of the contamination and jettison of the cargo of molasses. The District Court also entered conclusions of law and findings of fact, together with an interlocutory decree sustaining the claims of Southwestern and referred the case to Hugh Meredith, as Special Commissioner, to compute the damages sustained by Southwestern. Artemis has appealed to us from this interlocutory decree. The opinion of the District Court is reported in 92 F.Supp. 631, 1950 A.M.C. 2054.

On December 10, 1948, Southwestern chartered the Steam Tanker Demosthenes from Artemis for a period of eight and one-half months. During this time the Demosthenes made a total of sixteen voyages, carrying molasses cargoes. Within several days of the expiration of the said time charter, on August 26, 1949, Southwestern again chartered the Steam Tanker Demosthenes, this time for one round voyage from New Orleans, Louisiana, to Neuvitas, Cuba, to Norfolk, Virginia.

The Demosthenes sailed from New Orleans on or about the 27th. day of August, 1949, for Neuvitas; en route she received a radiogram ordering her to proceed to Banes, Cuba, to load her cargo. She complied with these instructions. After loading a molasses cargo of about 4,850 tons, the Demosthenes left Banes on September 7, 1949, at approximately 7:30 A.M. in fair weather and proceeded westerly along the northern coast of Cuba and through the Florida Straits bound for Hampton Roads, Virginia.

According to the District Court's finding of fact No. 10: "After loading was completed the Demosthenes sustained breakdowns of anchor windlass, rudder wheel gear and steering engine and as a result thereof was unable to depart until temporary repairs were performed by her crew."

It seems that no mention of these breakdowns was made in the vessel's log but Kostanos, Master of the Demosthenes, attributed this delay to "loss of tide."

On the morning of September 10, 1949, the Demosthenes ran into heavy weather off the Florida coast. The weather grew worse on September 11th and 12th, with waves breaking over the vessel's bow on all her sides and covering her weather deck. Difficulties were experienced with the steering engine and rudder gear, which had been repaired just before the ship left Banes. These difficulties were aggravated by a thirteen-inch crack which developed in a wasted section of the bow plate on the port side of the vessel in the way of the chain locker. This crack admitted enough water to put the ship down by the head and interfered with her maneuverability. A large quantity of the molasses was jettisoned in order to avert the loss of the Demosthenes and her cargo.

On September 13, 1949, the weather improved and the voyage ended on September 15, 1949, when the vessel discharged her cargo at Portsmouth, Virginia. On September 24, 1949, after all cargo had been discharged, the Demosthenes moved to the plant of the Newport News Shipbuilding and Dry Dock Company for preliminary survey while afloat. This survey was attended jointly by representatives of Southwestern and the vessel owner, as well as by representatives of the American Bureau of Shipping, and Bruning, a surveyor retained by the Demosthenes. The Demosthenes was then found to be still making water copiously in the No. 1 cargo tanks, notwithstanding the installation of numerous additional cement patches, and as it was impossible to pump the vessel dry, drydocking for bottom survey was required.

This final survey was held on drydock on December 9, 1949, and on subsequent dates, but neither Southwestern nor its proctors were notified of such survey nor afforded an opportunity to be present at the survey although notice had previously been given to the vessel's proctors of a request to be advised of the time and place of said survey.

The report of the American Bureau of Shipping subsequently issued under date of December 30, 1949, disclosed:

"(a) 65 rivets in the way of No. 1 port and starboard cargo tank seams between the keel plate and `A' Strake were found started and wasted excessively;

"(b) in the way of the chain locker on the port bow of the vessel, a severely wasted plate was found, which had worn thin, and cracked for a distance of thirteen inches."

Temporary repairs were thereafter effected and the Demosthenes sailed from Norfolk, Virginia, on December 20, 1949, for Piraeus, Greece, where she remained laid-up to the date of trial.

Pertinent provisions of the charter read:

"1. Warranty. The owner shall, before and at the commencement of the voyage, exercise due diligence to make the vessel seaworthy, properly manned, equipped, and supplied for and during the voyage * * and to make the tanks, holds, and other spaces in which cargo is carried fit and safe for its carriage and preservation." (Italics ours.)

"23(b). The Owner and the vessel in all matters arising under this Charter Party or any bill of lading issued hereunder shall be entitled to the like privileges, rights and immunities as are contained in Sections 3(6), 4, and 11 of the Carriage of Goods by Sea Act of the United States approved April 16, 1936."

The Carriage of Goods by Sea Act, Section 4, 46 U.S.C.A. § 1304 provides:

"§ 1304. Rights and immunities of carrier and ship — Unseaworthiness.

"(1) Neither the carrier nor the ship shall be liable for loss or damage arising or resulting from unseaworthiness unless caused by want of due diligence on the part of the carrier to make the ship seaworthy, and to secure that the ship is properly manned, equipped, and supplied, * * *. Whenever loss or damage has resulted from unseaworthiness, the burden of proving the exercise of due diligence shall be on the carrier or other persons claiming exemption under this section." (Italics ours.)

The heart of this case is the District Judge's conclusion of law number two which reads: "The Demosthenes was unseaworthy at the time she broke ground at Banes, Cuba, on September 7, 1949, upon commencement of the voyage in question, and had been unseaworthy for some time prior thereto, in respect of her hull, all of which conditions could have been ascertained by the exercise of due diligence, and the jettison and damage to the molasses, the said vessel's cargo, was the result of such unseaworthy conditions."

Whether Artemis exercised due diligence to make the vessel seaworthy is a question of fact. We can, accordingly, reverse the District Court here only if we hold the District Court's finding was clearly erroneous. We cannot so hold, therefore the judgment of the District Court must be affirmed.

Quite germane here is the opinion of Circuit Judge Swan, in a case somewhat similar to the case before us, Huilever, S. A. Division Huileries Du Congo Belge v. The Otho, 2 Cir., 139 F.2d 748, 749, 750:

"The finding that the owner of the Otho failed to exercise due diligence to make her seaworthy must likewise be supported, unless clearly erroneous. * * *

"It is urged that the defects, if any, in the H-3 plate were latent defects not discoverable by due diligence, but the record does not bear out this contention. Shortly after the vessel's return to New York, Mr. Narter made a thorough examination of the hold and was able by using his flashlight and hammer `and digging around along the heels of the longitudinal frames' to discover badly grooved plates other than the one that had fractured. There is also testimony that the conditions of corrosion observable in the H-3 plate after its removal from the ship must have resulted from corrosion over a period of years and existed before the Otho's outbound voyage in October, 1940. Hence it was not unreasonable to infer that the defect could have been detected by the exercise of greater care in examining hold No. 1 before commencement of the voyage in question."

See, also, Bradshaw v. The Virginia, 4 Cir., 176 F.2d 526, 529; Isthmian Steam Ship Co. v. Martin, 4 Cir., 170 F.2d 25, 26; The Scow No. 27, 4 Cir., 164 F.2d 778, 779; The Bill, D.C., 47 F.Supp. 969, Id., 4 Cir., 145 F.2d 470.

Proof that seawater entered the cargo tanks raises a presumption of "unseaworthiness" which the vessel appellant here must rebut by producing clear proof that the loss and damage did not result from failure to exercise due diligence to make the vessel seaworthy in fact, and that it did result from a peril of the sea. This heavy burden is not carried if the issue is left in doubt.

Said Circuit Judge Frank, in Wessels v. The Asturias, 2 Cir., 126 F.2d 999, 1001: "Proof of the presence of sea water, it cannot be disputed, raises a presumption of unseaworthiness which the carrier must rebut."

And, in Commercial Molasses Corporation v. New York Tank Barge Corporation, 314 U.S. 104, 109, 62 S.Ct. 156, 160, 86 L.Ed. 89, Chief Justice Stone stated: "* * * since the...