KOCH-ELLIS MARINE CONTRACT. v. Phillips Petroleum Co.

• Citation: 219 F.2d 520
• Decision Date: 09 February 1955
• Docket Number: No. 15201.,15201.
• Parties: KOCH-ELLIS MARINE CONTRACTORS, Inc., individually and as claimant of the barge KE-14, Appellant, v. PHILLIPS PETROLEUM COMPANY, Appellee.
• Court: United States Courts of Appeals. United States Court of Appeals (5th Circuit)

219 F.2d 520 (1955)

KOCH-ELLIS MARINE CONTRACTORS, Inc., individually and as claimant of the barge KE-14, Appellant, v. PHILLIPS PETROLEUM COMPANY, Appellee.

No. 15201.

United States Court of Appeals, Fifth Circuit.

February 9, 1955.

Joseph V. Ferguson, II, Cobb & Wright, New Orleans, La., for appellant.

Alfred M. Farrell, Jr., and Benjamin W. Yancey, New Orleans, La., Terriberry, Young, Rault & Carroll, New Orleans, La., of counsel for appellee.

Before HUTCHESON, Chief Judge, and RIVES and TUTTLE, Circuit Judges.

HUTCHESON, Chief Judge.

Alleging a written contract of affreightment, the duty of respondent thereunder to furnish a seaworthy barge for the carriage of a cargo of oil, its failure to do so, the sinking of the barge, and the loss of the cargo, appellee, libelant below, brought this suit against respondent and the barge for its damages.

Appellant, respondent and claimant below, denying fault on the part of the respondent and barge, alleged fault on libelant's part in failing to furnish and maintain a proper and safe wharf, and proper watchmen thereat.

In addition to these allegations, respondent, admitting the execution of the written contract, undertook to charge¹ libelant with negligence in failing to provide insurance for respondent's benefit.

In addition to its answer, respondent filed a cross-libel, in which, as a first cause of action, it alleged that the sinking of the barge and the loss of the cargo were due to the fault of libelant and that cross-libelant had sustained damages consisting of the cost of repairs to the barge, the loss of its use and other losses in the sum of $15,000.

As a second cause of action, or counterclaim, respondent, setting out, as it had done in its answer, conversations and understandings with appellant with respect to insurance for the benefit of respondent and the failure of libelant to provide the insurance, sued for the loss of additional compensation of $12,200, figured at 2 cents per barrel for oil carried by it under the written contract, which it alleged it would have charged but for its reliance upon an agreement of libelant to procure the insurance.

The district judge, on motion of libelant that the counterclaim was non-maritime and non-justiciable in admiralty,² dismissed it, and the cause proceeded to trial on the libel and answer and the first cause of action of the cross-libelant. After a full hearing, in the course of which respondent's offer to prove its oral understandings, with respect to the furnishing by libelant of insurance for respondent's benefit, was rejected on libelant's objection, that the contract was in writing and that, in violation of the parol evidence rule, the offered proof tendered to vary or contradict it, the district judge found as alleged by libelant: that the contract was for a seaworthy barge; that it was breached with resulting damage to, and without fault on the part of, libelant; and that libelant was entitled to a decree.

Insisting on the basis of assignments of error in number many, in substance two, that the decree may not stand, respondent is here seeking its reversal.

As its first argued ground of error, appellant, urging upon us that we have a right to, and should examine the evidence de novo,³ insists that in finding the barge unseaworthy and respondent and barge at fault for its sinking, the court misapprehended the evidence and the controlling principles of law.

As its second ground, it attacks the ruling of the court rejecting its offer to prove its oral understandings.

Appellee, on its part, urges upon us that the court did not err either in rejecting the proffered proof or in finding the barge unseaworthy and respondent at fault.

As to appellant's first ground, that it was error, to find and hold that the barge was unseaworthy and that respondent was at fault, and not to find that libelant was, appellee insisting, that the evidence fully supports the court's conclusion that there was a duty to furnish a seaworthy vessel and its finding of unseaworthiness and fault, cites in support this court's decision in Thomas Jordan, Inc., v. Mayronne Drilling Mud, Chemical & Engineering Service, 5 Cir., 214 F.2d 410 as directly in point, and relies also on Commercial Molasses Corp. v. New York Tank Barge Corp. 314 U.S. 104, 62 S.Ct. 156, 86 L.Ed. 89, although that case is put forward by appellant and strongly relied on by it.

As to appellant's second ground of error and the letter contract under which the work was to be done, constituted libelant's written proposal and respondent's written acceptance, appellee points out that the contract purported to be and was on its face a completely integrated contract, covering and including all matters properly cognizable under such a contract. So pointing, it insists that if the proof offered by libelant was intended to defeat, vary, limit or otherwise impair the warranty of seaworthiness, or any other obligation of respondent to libelant, it would of necessity be in complete violation of the parol evidence rule, as that rule has been declared and applied in admiralty. Cf. Upper Mississippi Towing Co. v. Calmes, 5 Cir., 162 F.2d 177 and cases cited in Note 3 thereof, and Geotechnical Corp. v. Pine Oil Co., 5 Cir., 196 F.2d 199.

We find ourselves in agreement with appellee on both of its positions.

We take up first appellant's second ground, the refusal of its offer of proof. The law is well settled, as contended for by it, that the proof of a parol agreement, dealing with matters independent of and not dealt with in and, therefore, not integrated into the written contract, will not be...