Pannell v. United States Lines Company

• Decision Date: 28 January 1959
• Docket Number: No. 31,Docket 25040.,31
• Citation: 263 F.2d 497
• Parties: Peter PANNELL, Libelant-Appellee, v. UNITED STATES LINES COMPANY, Respondent-Appellant.
• Court: U.S. Court of Appeals — Second Circuit

263 F.2d 497 (1959)

Peter PANNELL, Libelant-Appellee, v. UNITED STATES LINES COMPANY, Respondent-Appellant.

No. 31, Docket 25040.

United States Court of Appeals Second Circuit.

Argued October 21, 1958.

Decided January 28, 1959.

Kirlin, Campbell & Keating, New York City, for respondent-appellant, L. de Grove Potter and Richard H. Sommer, New York City, of counsel.

Hill, Rivkins, Middleton, Louis & Warburton, New York City, for libelant-appellee, David L. Maloof, New York City, of counsel.

Before SWAN and MOORE, Circuit Judges, and KAUFMAN, District Judge.

SWAN, Circuit Judge.

This is an appeal from an interlocutory decree for libelant in a suit to recover cargo damage. The damaged cargo was a yacht shipped from London to New York on the deck of respondent's S.S. American Flyer in May 1953. In unloading the yacht it sustained damage through fault of the carrier. The latter concedes its responsibility but maintains that its liability is limited to $500 by the terms of the contract of carriage. The District Court held it was not so limited, and granted recovery on the basis of $500 per "customary freight unit" pursuant to § 4(5) of the United States Carriage of Goods by Sea Act, 46 U.S.C.A. § 1304(5), which provides that the carrier shall not be liable "in an amount exceeding $500 per package * * *, or in case of goods not shipped in packages, per customary freight unit, * * * unless the nature and value of such goods have been declared by the shipper before shipment and inserted in the bill of lading." Judge Palmieri granted recovery on the basis of $500 per customary freight unit and referred to a commissioner computation of the damages. The opinion is reported in 157 F. Supp. 422.

This appeal differs from Gulf Italia Co. v. American Export Lines, Inc., 2 Cir., 263 F.2d 135, in that here the yacht was carried on deck. Consequently 46 U.S.C.A. § 1304(5) does not apply ex proprio vigore. See 46 U.S.C.A. § 1301 (c). However, the bill of lading refers to the Carriage of Goods by Sea Act and the question for decision is what is the legal effect of such reference.

Where a statute is incorporated by reference its provisions are merely terms of the contract evidenced by the bill of lading. The Westmoreland, 2 Cir., 86 F.2d 96, 97; The Tregenna, 2 Cir., 121 F.2d 940, 945 (both relating to incorporation by reference of the Harter Act); Petition of Petterson Lighterage & Towing Corp., D.C.S.D.N.Y., 154 F. Supp. 461, 467 (Carriage of Goods by Sea Act). Our task therefore, is to construe the contract to give consistent effect, if possible, to all of its terms.

Turning to the bill of lading: In Clause 1 it is provided that "the word `package' shall include any piece or shipping unit." Clause 13 provides that in respect to goods carried on deck certain risks shall be on the shipper "but in all other respects the custody and carriage of such goods shall be governed by the terms of this bill of lading and the carrier shall have the benefit italics added of all and the same rights, immunities, exceptions and limitations contained in said Carriage of Goods by Sea Act, notwithstanding Sec. 1(c) thereof, * * *" The fourth paragraph of Clause 23 reads: "It is understood that the meaning of the word `package' includes pieces and articles of any description except goods shipped in bulk." At the trial libelant's proctor stipulated that the yacht was not goods shipped in bulk. The first paragraph of Clause 2, upon which appellee particularly relies, reads: "This bill of lading shall have effect subject to the provisions of the Carriage of Goods by Sea Act * * * which shall be deemed to be incorporated herein, and nothing herein contained shall be deemed a surrender by the carrier of any of its rights, immunities...