Pioneer Import Corporation v. The Lafcomo

• Decision Date: 05 May 1947
• Citation: 159 F.2d 654
• Parties: PIONEER IMPORT CORPORATION v. THE LAFCOMO et al.
• Court: U.S. Court of Appeals — Second Circuit

159 F.2d 654 (1947)

PIONEER IMPORT CORPORATION v. THE LAFCOMO et al.

Circuit Court of Appeals, Second Circuit.

February 7, 1947.

Writ of Certiorari Denied May 5, 1947

John W. Crandall, of New York City (Hunt, Hill & Betts, Tompkins, Boal & Tompkins, and Arthur M. Boal, all of New York City, on the brief), for appellants.

George C. Sprague, of New York City, for appellee.

Before L. HAND, SWAN, and CLARK, Circuit Judges.

Writ of Certiorari Denied May 5, 1947. See 67 S.Ct. 1310.

CLARK, Circuit Judge.

In a previous decision in this case, Pioneer Import Corporation v. The Lafcomo, 2 Cir., 138 F.2d 907, certiorari denied Black Diamond Lines v. Pioneer Import Corporation, 321 U.S. 766, 64 S.Ct. 523, 88 L.Ed. 1063, we affirmed an interlocutory decree, Pioneer Import Corporation v. The Lafcomo, D.C.S.D.N.Y., 49 F.Supp. 559, holding claimant and respondent liable for the destruction of libellant's cargo. Now respondent and claimant have appealed from a final judgment determining the amount of that liability.

Because of the unavailability of refrigerated space in the fall of 1939, libellant shipped a cargo of lily of the valley pips from Rotterdam to New York on the deck of the steamship Lafcomo, owned by the claimant and operated by the respondent. Although it was agreed between libellant and respondent that the shipment was to be covered with tarpaulins, respondent's employees did not so cover it. Because of this omission and because of respondent's negligent stowage of the shipment in the wings of the hatches, instead of atop them, the shipment was rendered completely worthless by inundating sea water. Appealing, respondent and claimant seek to limit their liability for the loss to the invoice value of the shipment in accordance with the terms of a limitation-of-liability clause in the bill of lading. The contract of carriage, however, called for stowage with tarpaulins, not without. By failing to cover the shipment with tarpaulins, appellants deviated fundamentally from the agreed method of transportation. They are therefore deprived of the benefit of the limitation clause. St. Johns N. F. Shipping Corporation v. S. A. Companhia Geral Commercial do Rio De Janeiro, 263 U.S. 119, 44 S.Ct. 30, 68 L.Ed. 201; The Sarnia, 2 Cir., 278 F. 459, certiorari denied Sarnia S. S. Co. v. DeVasconcellos, 258 U.S. 625, 42 S.Ct. 382, 66 L.Ed. 797. The fact that the claim is based on negligence does not affect the applicability of this rule to the measure of damages. The proper measure of damages, as the District Court held, was the market value of the cargo in New York, had it been covered with tarpaulins during the voyage. Olivier Straw Goods Corporation v. Osaka Shosen Kaisha, 2 Cir., 47 F.2d 878, 74 A.L.R. 1378, certiorari denied Osaka Shosen Kaisha v. Olivier Straw Goods Corporation, 283 U.S. 856, 51 S.Ct. 648, 75 L.Ed. 1462.

The District Court referred the question of damages to a commissioner. Before the commissioner, appellants introduced evidence of the value of the pips in New York had they arrived in a sprouted condition. Neither the commissioner nor the District Court, however, made findings on this point; and to this appellants assign error. But the pips had not arrived sprouted. Moreover, at the first trial of the case, the District Court had found as a fact that the pips would not have arrived sprouted had they been covered. Pioneer Import Corporation v. The Lafcomo, supra, D.C.S.D.N.Y., 49 F.Supp. 559, 563. By this finding the court decided against appellants on their argument that libellant had suffered no damages at all because the pips would still have arrived in a sprouted condition even had they been covered. Appellants had supported this argument with testimony that if the pips had sprouted they would have been substantially worthless. Had appellants prevailed on this argument the question of liability would have been decided in their favor. The finding was therefore an integral part of the court's holding on liability. Since we approved it on appeal, the question of sprouting was foreclosed to appellants before the commissioner and the District Court be...