Commercial Molasses Corporation v. New York Tank Barge Corporation the No 73

• Citation: 314 U.S. 104,86 L.Ed. 89,62 S.Ct. 156
• Decision Date: 17 November 1941
• Docket Number: No. 14,14
• Parties: COMMERCIAL MOLASSES CORPORATION v. NEW YORK TANK BARGE CORPORATION. THE T.N. NO. 73. Re
• Court: United States Supreme Court

314 U.S. 104

62 S.Ct. 156

86 L.Ed. 89

COMMERCIAL MOLASSES CORPORATION

v NEW YORK TANK BARGE CORPORATION. THE T.N. NO. 73.

No. 14.

Reargued Oct. 16, 1941.

Decided Nov. 17, 1941.

Messrs. T. Catesby Jones and Leonard J. Matteson, both of New York City, for petitioner.

Mr. Robert S. Erskine, of New York City, for respondent.

Mr. Chief Justice STONE delivered the opinion of the Court.

This is a proceeding in admiralty originating in the District Court upon a petition by respondent as chartered owner of the tank barge 'T.N. No. 73', for limitation of liability for damage to petitioner's shipment of molasses resulting from the sinking of the barge in New York harbor.

Petitioner, the sole claimant in the limitation proceeding, filed, in behalf of the insurer, its claim for loss of the molasses on the barge, which sank on Oct. 23, 1937, while taking on the shipment from the S.S. 'Althelsultan'. The barge sank in smooth water, without contact with any other vessel or external object to account for the sinking. By the contract of affreightment with petitioner's predecessor in interest, extended to cover the year 1937, respondent undertook to transport the molasses by barges in New York harbor from vessels or tidewater refineries to the shipper's customers and agreed that the barges are 'tight, staunch, strong and in every way fitted for the carriage of molasses within the limits above mentioned and (respondent) will maintain the barges in such condition during the life of this contract.' The contract also con- tained an undertaking on the part of the shipper of the molasses to effect insurance on cargoes for the account of respondent, the breach of which, it is contended, operated to relieve respondent from liability for any unseaworthiness of the barge.

The 'T.N. No. 73' was a steel tank barge with four cargo tanks, two forward and two aft, separated by bulkheads, one extending fore and aft and the other athwartship. It had a rake fore and aft beginning 23 inches below the deck, affording space for fore and aft peak tanks. The customary method of stowing the barge was to pump the molasses into the forward tanks until the barge had a specified freeboard, then into the stern tanks until the stern had another specified freeboard, then back into the forward tanks until the barge was trimmed fore and aft.

In the case of the present shipment the customary procedure was followed and the molasses was first pumped into the forward and then into the after tanks at a rate of from 3 to 3 1/2 tons a minute. When the stern had approximately the desired freeboard the mate of the barge went forward to open the valves of the discharge pipes connecting with the forward tanks so as to fill them sufficiently to trim the barge fore and aft. On his way he stopped for a short time, the length of which was not precisely fixed, to carry on a conversation with some of the men on the vessel lying alongside. When he reached the valves for the forward tanks and before the valves for the after tanks had been closed, the barge sank by the stern. Only a small part of the molasses was saved and the value of that lost largely exceeded the value of the barge after salvage operations.

Respondent attributed the sinking to overloading of the after tanks resulting from the mate's delay in shifting the flow of the molasses from the stern to the forward tanks. If, as alleged, over-filling of the stern tanks caused the loss without the privity or knowledge of respondent, it could limit liability. R.S. § 4283, 46 U.S.C. § 183, 46 U.S.C.A. § 183; La Bourgogne (Deslions v. La Compagnie Generale Transatlantique), 210 U.S. 95, 122, 28 S.Ct. 664, 673, 52 L.Ed. 973; The George W. Pratt, 2 Cir., 76 F.2d 902. But it was unnecessary to decide any question of limiting liability unless petitioner, the sole claimant, succeeded in establishing its claim.

On the issues thus presented the District Court heard a great deal of testimony by witnesses who testified to all the circumstances attending the loading and sinking of the barge, and by experts as to its theoretical load capacity and the probable disposition of its load at the time the barge sank. There was also much evidence bearing on the seaworthiness of the vessel. This included the testimony of a representative of the cargo interests who had inspected the barge just before she began to receive the molasses and had found the tanks dry and clean, and who admitted he had found no evidence of leakage. There was also testimony by a diver who had examined the barge while she was on the bottom, and of others who had examined her condition after she had been raised and placed in dry dock.

After a careful review of all the evidence the trial judge found that it was not sufficient to establish the fact that the sinking was caused by overloading the after tanks. He also found as a fact that upon all the evidence 'the cause of the accident has been left in doubt'. From all this he concluded that respondent was chargeable upon its warranty of seaworthiness by reason of the 'presumption' of unseaworthiness arising from the unexplained sinking of the barge which would deprive the owner of the right to limit liability. But as he thought the insurance clause in the contract of affreightment required petitioner to effect cargo insurance for account of respondent, which it had failed to do, he dismissed petitioner's claim. 1939 A.M.C. 673.

The Court of Appeals affirmed, 2 Cir., 114 F.2d 248, 250, but for a different reason than that assigned by the trial judge for his decision. It held that the burden was on petitioner to prove that respondent had furnished an unseaworthy barge. The court sustained the trial court's finding which it interpreted as meaning 'that the evidence as to whether or not the barge sank because of unseaworthiness, was so evenly matched that the judge could come to no conclusion upon the issue.' But it held that the "presumption' of unseaworthiness', which would arise from the evidence of the sinking of the barge in smooth water without any other apparent or probable cause, did not survive the further proof which left in doubt the issue of the cause of the loss. The court accordingly held that petitioner had not sustained its burden. It thus became unnecessary to consider what burden would rest on the barge owner if he were seeking to limit liability on an admittedly valid claim. We granted certiorari, 311 U.S. 643, 61 S.Ct. 394, 85 L.Ed. 410, to resolve an alleged conflict of the decision below with those of other circuit courts of appeals. Pacific Coast S.S. Co. v. Bancroft-Whitney Co., 9 Cir., 94 F. 180; The John Twohy, 3 Cir., 279 F. 343; Loveland Co. v. Bethlehem Steel Co., 3 Cir., 33 F.2d 655; Gardner v. Dantzler Lumber & Export Co., 5 Cir., 98 F.2d 478; cf. The Edwin I. Morrison, 153 U.S. 199, 14 S.Ct. 823, 38 L.Ed. 688, and because of the importance in the maritime law of the principle involved.

With respect to the burden of proof, this case is to be distinguished from those in which the burden of proving seaworthiness rests upon the vessel when it is a common carrier or has assumed the obligation of a common carrier. The present contract of affreightment was for private carriage in New York harbor: The Fri, 2 Cir., 154 F. 333; The G. R. Crowe, 2 Cir., 294 F. 506; The Wildenfels, 2 Cir., 161 F. 864; The C. R. Sheffer, 2 Cir., 249 F. 600; The Lyra, 9 Cir., 255 F. 667; The Nordhvalen, D.C., 6 F.2d 883, and thus gave to respondent the status of a bailee for hire of the molasses. Southern Ry. v. Prescott, 240 U.S. 632, 640, 36 S.Ct. 469, 472, 60 L.Ed. 836; Kohlsaat v. Parkersburg & M. Sand Co., 4 Cir., 266 F. 283, 11 A.L.R. 686; Alpine Forwarding Co. v. Pennsylvania Railroad, 2 Cir., 60 F.2d 734; Gerhard & Hey, Inc. v. Cattaraugus T. Co., 241 N.Y. 413, 150 N.E. 500. Cf. The Nordhvalen, supra, 6 F.2d at page 887. Hence we are not concerned with the rule that one who has assumed the obligation of a common carrier can relieve himself of liability for failing to carry safely only by showing that the cause of loss was within one of the narrowly restricted exceptions which the law itself annexes to his undertaking, or for which it permits him to stipulate. The burden rests upon him to show that the loss was due to an excepted cause and that he has exercised due care to avoid it, not in consequence of his being an ordinary 'bailee' but because he is a special type of bailee who has assumed the obligation of an insurer. Schnell v. The Vallescura, 293 U.S. 296, 304, 55 S.Ct. 194, 196, 79 L.Ed. 373, and cases cited. See Coggs v. Bernard, 2 Ld.Raym. 909, 918.

For this reason the shipowner, in order to bring himself within a permitted exception to the obligation to carry safely, whether imposed by statute or because he is a common carrier or because he has assumed it by contract, must show that the loss was due to an excepted cause and not to breach of his duty to furnish a seaworthy vessel. The Edwin I. Morrison, supra, 153 U.S. at page 211, 14 S.Ct. at page 826, 38 L.Ed. 688; The Majestic, 166 U.S. 375, 17 S.Ct. 597, 41 L.Ed. 1039; Schnell v. The Vallescura, supra; The Beeche Dene, 5 Cir., 55 F. 525. Cf. 39 Stat. 539, 49 U.S.C. § 88, 49 U.S.C.A. § 88; Uniform Bill of Lading Act, § 12. See IX Wigmore on Evidence, 3rd Ed., § 2508 and cases cited. And in that case, since the burden is on the shipowner, he does not sustain it, and the shipper must prevail if, upon the whole evidence, it remains doubtful whether the loss is within the exception. The Folmina (Jahn v. The Folmina), 212 U.S. 354, 363, 29 S.Ct. 363, 365, 53 L.Ed. 546, 15 Ann.Cas. 748; Schnell v. The Vallescura, supra, 293 U.S. at page 306, 307, 55 S.Ct. at page 197, 79 L.Ed. 373. A similar rule is applied under the Harter Act, 46 U.S.C.A. § 190 et seq., which gives to the owner an excuse for unseaworthiness, if he has exercised due care to make his vessel seaworthy, for there the burden rests upon him to show that he has exercised such care....