Southern Nitrogen Co. v. Stevens Shipping Co.

• Decision Date: 14 October 1966
• Docket Number: No. 3,No. 42243,42243,3
• Citation: 114 Ga.App. 581,151 S.E.2d 916
• Parties: SOUTHERN NITROGEN COMPANY v. STEVENS SHIPPING COMPANY
• Court: Georgia Court of Appeals

Page 916

151 S.E.2d 916

114 Ga.App. 581

SOUTHERN NITROGEN COMPANY v. STEVENS SHIPPING COMPANY.

No. 42243.

Court of Appeals of Georgia, Division No. 3.

Oct. 14, 1966.

Rehearing Denied Nov. 9, 1966.

Syllabus by the Court

1. In order to recover, a party seeking indemnity from another must allege and prove an actual legal liability to the injured party to whom payment was made.

2. In failing to present argument, appellant has abandoned its enumeration of error as to the sustaining of the general demurrer to Court 2 of the petition.

Southern Nitrogen Company filed suit in the Superior Court of Chatham County against Stevens Shipping Company. Its petition as amended was in two counts and alleged in substance that plaintiff executed a contract on March 1, 1962, with H. J. Baker & Bro., a brokerage firm, for the purchase of 1,500 short tons in bulk of 'Prilled, uncoated Urea, minimum 46% Nitrogen,' at a price of '73.00 per short Nitrogen,' at a price of '$73.00 per short switching charge allowed, to Port Wentworth, Georgia,' shipment to be made 'as nearly as possible ex vessel from our chartered boat, expected to sail from abroad end March,' as shown by a copy of the contract attached as an exhibit to the petition. This contract contained the following provision: 'Buyer accepts all risk and responsibility for, and agrees to hold seller harmless from any liability arising out of any use of the material by buyer or any subsequent purchaser. Byer further agrees that no claim will be made for special, consequential or coincidental damages of any kind, whether growing out of the non-delivery of, or use or inability to use said material, or any other cause. In no event shall any claim made by the buyer under this contract, whether for non-delivery of the material, deficiency in quality or otherwise, be greater than the purchase price of the particular quantity of the material in respect of which damages are claimed.'

The petition further alleged that the defendant shipping company operated a shipping agency, stevedoring business and warehouse for hire at the Port of Savannah, Georgia, and was the local agent of the Baker Company; that the urea contracted for was shipped into the Port of Savannah on the S.S. Cydonia and S.S. Cydonia and the S.S. Alabama, for which ships the defendant acted as agent, and was unloaded and stored i bulk in the defendant's warehouse; that the defendant 'negligently and carelessly allowed said urea to be stored adjacent to a bulk pile of ammounium sulphate and failed to provide an adequate partition between the two piles so that by their close proximity said urea was contaiminated by said ammonium sulphate to such an extent that it was rendered unfit for industrial use as hereinafter stated'; and that on September 19, 1963, the plaintiff ordered delivery of 1000 100-pound bags of the urea to be provided from the bulk pile maintained by the defendant in its warehouse, the same to be packed by the defendant in 100-pound bags provided by the plaintiff, according to instructions issued to the defendant by its principal, the Baker Company, on January 4, 1963, a copy of the letter containing such instructions being attached as an exhibit to the petition and providing as follows: 'This is with reference to future shipments of urea for the account of Southern Nitrogen Company for 'Industrial Use.' We have had some discussions with Mr. Paul Weller of Southern Nitrogen regarding their requirements for the abovenoted material, and it is, of course, essential that such deliveries must be clean, sound material. When you receive instructions from Southern Nitrogen they will tell you that it will be for industrial use and you will arrange to bag the material in their bags of 100-lbs. net each from storage stocks ex the steamer Alabama. You will please advise all concerned to be particularly careful when filling these 'industrial use' orders. Please acknowledge receipt of this letter and your understanding of the instructions.' The petition further alleged that on or about September 19, 1963, the defendant packed the urea in the bags provided and shipped same to plaintiff's plant warehouse at Port Wentworth, Georgia; that plaintiff, unaware that such bags contained contaminated urea, stored same in its plant warehouse until October 8, 1963, when it shipped 400 bags (20 tons) of urea to the Borden Chemical Company at Fayetteville, North Carolina, pursuant to an order for said urea received by plaintiff in the normal course of business; that the Borden Chemical Company uses urea as one of the ingredients in producing manufactured resin and that on the day shipment was received, 214 bags (21,900 pounds) of the urea were added to Borden's reactor or kettle as a part of the normal resin manufacturing process; that within 15 minutes from the time the first bag of urea was dumped into the reactor, a violent chemical reaction occurred and the entire contents of the reactor gelled or solidified, requiring around-the-clock operations for 152 hours by all available personnel to get the reactor and its components operational again; that the damage to the reactor and its components and other special damages sustained by the Borden Chemical Company as a result of this solidification totaled $19,447.42 as enumerated in an attached list; and that this solidification and resulting damages were solely caused by the presence of quantities of ammonium sulphate in the urea resulting from the defendant's negligence in allowing it to become contaminated while stored in the defendant's warehouse.

The petition further alleged that the plaintiff insisted that the defendant make restitution to the Borden Chemical Company but that defendant refused, and that upon defendant's refusal to negotiate a settlement with the Borden Chemical Company, and in order to satisfy continuing demands upon it by Borden, the plaintiff negotiated and made a fair and reasonable settlement of Borden's claim...