Luria Bros. & Co., Inc. v. Associated Metals & Minerals Corp.

• Decision Date: 25 July 1972
• Citation: 343 N.Y.S.2d 152,73 Misc.2d 937
• Court: New York City Court
• Parties: , 1973 A.M.C. 433 LURIA BROTHERS & CO., INC., Plaintiff, v. ASSOCIATED METALS & MINERALS CORP., Defendant and Third-Party Plaintiff, LEHIGH MARINE DISPOSAL CORP., and M. J. Rudolph Corporation, Third-Party Defendants.

Page 152

343 N.Y.S.2d 152

73 Misc.2d 937, 1973 A.M.C. 433

LURIA BROTHERS & CO., INC., Plaintiff, v. ASSOCIATED METALS & MINERALS CORP., Defendant and Third-Party Plaintiff, LEHIGH MARINE DISPOSAL CORP., and M. J. Rudolph Corporation Third-Party Defendants.

Civil Court of the City of New York, New York County, Trial Term, Part 29.

July 25, 1972.

Poles, Tublin, Patestides & Stratakis, New York City, by Patrick V. Martin, New York City, of counsel, for plaintiff.

Hill, Rivkins, Warburton, McGowan & Carey, New York City, by Vincent J. Ryan, New York City, of counsel, for defendant and third-party plaintiff, Associated Metals & Minerals Corp.

Klein & Sterling, New York City, by Max Cohen, New York City, of counsel for third-party defendant Lehigh Marine Disposal Corp.

Purdy, Lamb & Marchisio, New York City, by Juvenal L. Marchisio, New York City, of counsel, for third-party defendant M. J. Rudolph Corp.

BURTON S. SHERMAN, Judge.

In this nonjury action the plaintiff, Luria Brothers (Luria) seeks to recover the balance of the purchase price of scrap metal sold to the defendant, Associated Metal & Minerals Corporation (Associated). Associated counterclaimed, alleging that the balance of the metal was lost as a result of the plaintiff's failure to furnish a seaworthy barge for delivery. Associated also impleaded the barge owner, Lehigh Marine Disposal Corp. (Lehigh) and M. J. Rudolph Corporation (Rudolph), a crane operator seeking indemnity and salvage costs, claiming that the loss of the metal was the result of the unseaworthiness and negligence of Lehigh's barge and/or the negligence of Rudolph. Lehigh counterclaimed in the impleader action for the loss of the barge, claiming negligence by Associated and cross-claimed against Rudolph for the loss of the barge for negligence.

Preliminarily, Rudolph's motion to dismiss the third-party action against it on the grounds of improper joinder of parties was denied by the Court on the authority of Section 1007 CPLR. However, no evidence being furnished to show any liability on the part of Rudolph, the third-party complaint and the cross-claim are dismissed as to Rudolph, and Rudolph may have judgment thereon with the cost of this action against Associated and Lehigh.

The undisputed facts are that on February 27, 1970, Luria as seller and Associated as buyer entered into a contract for the sale of scrap metal, delivery to be made 'FAS Steamer your berth Port Elizabeth, New Jersey.' Luria had a shipping contract with Lehigh and, pursuant to oral request, Lehigh as owner furnished a wooden barge #280 at Luria's yard in Brooklyn to deliver the scrap metal. The barge arrived at the yard on April 4, 1970, and, I find, was properly loaded with the cargo of scrap metal. On April 7, the barge in good trim was towed by Lehigh to its facilities on Staten Island. On April 8, 1970, a preliminary marine survey was made, showing the cargo to be 563.9347 gross tons of No. 1 HMS. The surveyor at that time found the wooden barge to be dry and in good condition. It remained at Staten Island for further shipping orders. On April 22, 1970, the barge, in response to instructions from Luria, was again towed by Lehigh, arriving at Associated's berth No. 59 at Port Elizabeth, New Jersey, in the early morning of April 24, 1970, to await the arrival of the steamship 'Oceanic Peace.' This vessel, which was to receive the scrap metal, arrived at Associated's Pier 63 on April 24, 1970. On Saturday, April 25, 1970, the barge was shifted by Associated from berth No. 59 to a position alongside of Rudolph's crane at the steamship. The loading of the steamship was to have taken place on Monday, April 27, 1970.

The barge was seen afloat by an employee of Associated on Saturday, April 25, 1970. Two bargemen employed by Lehigh to inspect the barge stated that they did so on Sunday, April 26, 1970, at about 1:30 p.m. and found it to be dry and in good trim. On Monday morning, April 27, 1970, at approximately 7:30 a.m., before the unloading was to have taken place, the barge was found to have capsized and her cargo of scrap metal dumped into the water.

The weather was good, the water calm, and there was no shipping activity at the location of the barge on Sunday, April 26, 1970. Associated notified Lehigh that the barge had capsized, but Lehigh made no effort to retrieve it although it was still afloat. Because there was no joint survey, there is no direct evidence as to how the accident happened. Nor were there any eyewitnesses. The barge was eventually removed by the Army Corps of Engineers as a hazard to navigation and destroyed.

As to the main action, the contract provided for delivery 'FAS Steamer your berth Port Elizabeth, New Jersey.' Delivery was made according to these terms. The barge was at Associated's berth at least 3 days before it capsized and at least 2 days alongside the steamship Oceanic Peace. Title to the scrap metal passed to Associated. (Section 2--509(1)(b), Section 2--319(2)(a) Uniform Commercial Code, Cf Dana Debs, Inc. v. Lady Rose Stores, Inc., 65 Misc.2d 697, 319 N.Y.S.2d 111; Minex v. International Trading Company of Virginia, D.C., 303 F.Supp. 205; Madeirense Do Brasil S.A. v. Stulman-Emrick Lumber Co., 2 Cir., 147 F.2d 399; Williston on Contracts, 3rd Ed., Vol. 10, Section 1080A, p. 112) Nor was there any evidence of negligence on the part of Luria in the selection of Lehigh as a carrier or evidence of improper loading of the cargo. Accordingly the plaintiff Luria may have judgment against Associated in the amount of $9,686.73 with interest thereon from the 12th day of May 1970, and the counterclaim by Associated against Luria is dismissed.

As to the third-party action, since it involves an alleged maritime tort, Federal Law applies (Riley v. Agwilines Inc., 296 N.Y. 402, 73 N.E.2d 718). Lehigh as owner of the barge was under an absolute warranty to furnish a seaworthy vessel. Nor is this duty discharged because the defects are latent. (The Caledonia, 157 U.S. 124, 15 S.Ct. 537, 39 L.Ed. 644; Work v. Leathers, 97 U.S. 379, 24 L.Ed. 1012.) Moreover, pursuant to the contract of affreightment with Luria, Lehigh as bailee of the cargo was also under a duty to exercise reasonable care. (The C. R. Sheffer, 2 Cir., 249 F. 600). On the other hand, Associated at the time of the loss was not only a consignee of the cargo but a bailee of the barge and under a duty to exercise reasonable care to protect it until the owner recovered possession. (C. F. Harms Co. v. Erie R. Co., 2 Cir., 167 F.2d 562, 563.) The fact that each side in this case claims a breach of bailment by the other does not present any unusual conflict. For the burden of each party as a bailee to rebut the initial presumption of negligence or breach of warranty of seaworthiness may also serve to strengthen its own position as bailor that the bailed article was delivered in good condition. (Richmond Sand & Gravel Corp. v. Tidewater Const. Corp., 4 Cir., 170 F.2d 392, 394; The Irving, D.C., 16 F.Supp. 22, aff'd, Conners Marine Co. v. Manhattan Lighterage Co., 2 Cir., 91 F.2d 1011.) However, despite the duty to explain the loss, each party still has the burden to prove its claim by a fair preponderance of the credible evidence. (Commercial Molasses Corp. v. New York Tank Barge Corp., 314 U.S. 104, 62 S.Ct. 156, 86 L.Ed. 89.)

The evidence was that the barge when last seen was moored beside the Rudolph crane, which in turn was next to the Oceanic Peace at berth 63 at Port Elizabeth, New Jersey. The weather was good. There was no movement of boats or harbor activity at the slip on Sunday, April 26, 1970. The berth was sheltered and free from the hazards of the high seas. The barge was carrying less than full capacity. The unexplained capsizing of a barge in calm waters at a sheltered berth with no activity clearly creates a presumption of unseaworthiness. (The Jungshoved, 2 Cir., 290 F. 733, cert. den. 263 U.S. 707, 44 S.Ct. 35, 68 L.Ed. 517; ...