MW Zack Metal Company v. The SS Birmingham City

• Decision Date: 19 June 1961
• Docket Number: Docket 26642.,No. 358,358
• Citation: 291 F.2d 451
• Parties: M. W. ZACK METAL COMPANY, Libelant-Appellant, v. THE S.S. BIRMINGHAM CITY and Bristol City Line of Steamships, Ltd., Claimant-Respondent, and Jarka Corporation, Impleaded Respondent.
• Court: U.S. Court of Appeals — Second Circuit

291 F.2d 451 (1961)

M. W. ZACK METAL COMPANY, Libelant-Appellant, v. THE S.S. BIRMINGHAM CITY and Bristol City Line of Steamships, Ltd., Claimant-Respondent, and Jarka Corporation, Impleaded Respondent.

No. 358, Docket 26642.

United States Court of Appeals Second Circuit.

Argued May 1, 1961.

Decided June 19, 1961.

Anthony B. Cataldo, New York City, for libelant-appellant.

Donald B. Allen, of Hill, Betts, Yamaoka, Freehill & Longcope, New York City (James E. Freehill, of Hill, Betts, Yamaoka, Freehill & Longcope, New York City, on the brief), for claimant-respondent.

Joseph E. Soffey, New York City (George J. Conway, New York City, on the brief), for impleaded respondent.

Before LUMBARD, Chief Judge, CLARK, Circuit Judge, and STEEL, District Judge.^*

CLARK, Circuit Judge.

Libelant, M. W. Zack Metal Company, appeals from a decree for respondent in an action brought in admiralty to recover for damage to 77 bundles of steel purchased by libelant and shipped to the United States on respondent's SS Birmingham City. After respondent's ship docked in Hoboken, New Jersey, the steel was unloaded by impleaded respondent, Jarka Corporation, a stevedoring company. It was then lightered to Weehawken, and there loaded into three open railroad gondolas for delivery to libelant in Detroit. When the shipment arrived in Detroit, libelant's employees found it to be rusted and otherwise damaged; and libelant thereupon instituted the present action. Judge Clancy dismissed the libel after trial, saying:

"I find that there is no credible evidence that the steel that is involved in this case was discharged from the ship either crimped, wet, rusty or in otherwise damaged condition. The only evidence of such damage is the testimony of Krasnov and I do not believe any of Krasnov\'s testimony.

"I find that there is no competent evidence in the case that the libelant is the owner of the claim which it prosecutes.

"I find further that this action was started in October, 1954, and there was no notice of plaintiff\'s claim given as required by the Statute, 46 U.S.C.A. 1303.

"On all these grounds, I dismiss the libel."

Libelant's ownership of the claim. Despite libelant's failure to show in full detail the chain of title leading to its acquisition of the steel, we think there can be no doubt of its right to maintain the present action. The steel in question was shipped under a bill of lading dated April 24, 1953, issued by respondent at the port of Avonmouth, England, and containing the notation, "Notify Merit Import & Export Corp'n, 82 Wall Street, New York, and Schwabach & Co., 60 Beaver Street, New York." By confirmation order dated April 23, 1953, the steel to be thus shipped was sold by Framen Steel Supply Company, Inc., to the libelant. When the shipment arrived in Hoboken, the arrangements for its eventual transportation to Detroit were carried out according to instructions given by the libelant. At no time did any of the parties in the somewhat disconnected chain of title challenge the fact that libelant was the beneficial owner of the steel. Indeed, when its right to maintain this action was questioned, libelant obtained from Framen Steel Supply Company, Inc., and from Schwabach & Co., assignments of any claim they might have against respondents for damage to the steel in question. In view of these facts we think that, irrespective of niceties of "title," libelant was clearly the beneficial owner of the steel shipped on respondent's vessel, and as such was entitled in its own right to maintain this action for damages. F.R. 17(a). We are able to reach this result without reliance on the fact that it received assignments from two of its mesne suppliers after the statute of limitations had run, although that statute would not have been a bar even if the action depended on the assignments, since it was timely commenced and its amendment to allege the assignments would not constitute a new claim for purposes of the statute of limitations. F.R. 15(a).

Libelant's proof as to its claim. Since libelant failed to give notice of the loss or damage within three days of delivery to its bailee, it had the burden of rebutting the prima facie defense of delivery in good condition raised by the Carriage of Goods by Sea Act, 46 U.S.C. § 1303(6). Miami Structural Iron Corp. v. Cie Nationale Belge de T. M., 5 Cir., 224 F.2d 566; see Poor, Charter Parties and Ocean Bills of Lading 159-60 (4th Ed. 1954). The district court found that the only evidence showing delivery in bad condition was the testimony of libelant's former employee, Krasnov, whom the court found unworthy of belief. There were various inconsistencies in Krasnov's story, and the trial court's judgment as to the credibility of this important witness cannot be disturbed.

So far as rust is concerned — and that is the principal damage complained of — the only other direct evidence that the steel was discharged in rusted condition was given by the deposition of George Jeremy, terminal superintendent for the stevedoring company at the time of unloading. Jeremy stated that he saw an undetermined quantity of steel in rusted condition on the pier after it was discharged. It is not entirely clear, however, whether the rust observed was of the steel sheets themselves, or only of the outer wrapping sheet, which can ordinarily be expected to...