United States v. Central Gulf Lines, Inc., Civ. A. No. 81-3339.

• Decision Date: 02 December 1983
• Docket Number: Civ. A. No. 81-3339.
• Citation: 575 F. Supp. 1430
• Parties: UNITED STATES of America v. CENTRAL GULF LINES, INC., et al.
• Court: U.S. District Court — Eastern District of Louisiana

575 F. Supp. 1430

UNITED STATES of America v. CENTRAL GULF LINES, INC., et al.

Civ. A. No. 81-3339.

United States District Court, E.D. Louisiana.

December 2, 1983.

Roy F. Blondeau, Jr., Asst. U.S. Atty., New Orleans, La., for plaintiff.

John J. Broders, New Orleans, La., for defendants.

OPINION AND ORDER

McNAMARA, District Judge.

The United States of America brings this action under the Carriage of Goods by Sea Act (COGSA), 46 U.S.C. §§ 1300-1315, to recover for shortages in a consignment of refined soybean oil loaded aboard the S/S GREEN ISLAND in New Orleans and discharged in Kandla, India.

I. FACTS

Under a bill of lading issued on October 24, 1979, by Central Gulf Lines, Inc., owner of the S/S GREEN ISLAND, 18,466 drums of soybean oil were shipped by the Commodity Credit Corporation (CCC), an agency of the United States, to the representative of the Cooperative League of the United States of America (CLUSA) in India. The oil was to be distributed throughout India by the National Development Dairy Board, under the auspices of the Food For Peace Program, 7 U.S.C. § 1721.

The bill of lading certifies that the cargo was received "clean on board" the GREEN ISLAND, a LASH-type vessel. Upon arrival of the vessel in the Port of Kandla on December 1, 1979, discharge by stevedores of the Kandla Port Trust commenced soon thereafter and was completed by February 23, 1980.

At the request of CLUSA, the cooperating sponsors, the discharge was attended by J.B. Boda, Ltd., marine surveyors. The Boda survey report indicates that 109 drums were short-landed. A short-landing certificate issued by the Kandla Port Trust corroborates the survey report.

Nonetheless, Defendant-carrier asserts that the shipper's action for the value of the short-landed cargo must fail for two reasons: (1) the documents necessary to establish the shipper's prima facie case under COGSA are inadmissible, and (2) the United States is not the proper party plaintiff.

II. ADMISSIBILITY OF DOCUMENTS

At trial, the Court took under advisement the admissibility of several documents which are crucial to shipper's ability to carry its burden of proof—the shortlanding certificate and the cargo survey reports. The shipper establishes a prima facie case of carrier liability under COGSA for shortage or damage by proving: (1) The carrier received the cargo in good condition, as evidenced by a "clean" bill of lading, and (2) At the port of destination outturned an amount less than that declared on the bill of lading, as evidenced by the shortlanding certificate or cargo survey reports. COGSA, 46 U.S.C. § 1303(4); Associated Metals and Minerals Corp. v. M/V RUPERT DE LARRINAGA, 581 F.2d 100, 101 (5th Cir.1978); Otis McAllister Export Corp. v. Grancolombiana (New York), Inc., 216 F.Supp. 756, 757 (E.D.La.1963).

The carrier asserts that the shipper cannot carry the requisite burden of proof because the documents necessary to prove a shortage—either the short-landing certificate or survey reports—are inadmissible as hearsay. These documents, contends Central Gulf, are not public records of the United States under Federal Rule of Evidence 803(8)¹, nor are the documents admissible as business records under Rule 803(6)², because there was no identification testimony from an employee of the office that prepared the suspect documents. Whether labeled "business records" or "public records", I find that the documents are admissible.

The only witness at trial was Thomas W. Bell, the Chief of Claims and Collections for the Department of Agriculture, and contracting officer and assistant treasurer for the CCC. Bell's duties include supervision over the filing, pursuit, and adjudication of ocean transportation claims which arise from the activities of these agencies. Significantly, he is also the custodian of the documents in question.

Business Records

That these documents are kept "in the course of a regularly conducted business activity" is not disputed. See Rule 803(6). Indeed, by statute, the CCC is required to compile and retain such documents.³

However, Central Gulf argues that these documents are inadmissible as business records because the CCC did not prepare them. Contrary to the contention of Central Gulf,

Rule 803(6) does not require that the records be prepared by the business which has custody of them. Where circumstances indicate that the records are trustworthy, the party seeking to introduce them does not have to present the testimony of the party who kept the record or supervised its preparation. Testimony by the custodian of the record or other qualified witness that the record is authentic and was made and kept in the regular course of business will suffice to support its admission.

United States v. Veytia-Bravo, 603 F.2d 1187, 1191-92 (5th Cir.1979), rehearing en banc denied 607 F.2d 1006, cert. denied, 444 U.S. 1024, 100 S.Ct. 686, 62 L.Ed.2d 658 (1980). See also Mississippi River Grain Elevator v. Bartlett & Co., Grain, 659 F.2d 1314, 1318-19 (5th Cir.1981); United States v. Ullrich, 580 F.2d 765, 771-72 (5th Cir.1978), rehearing en banc denied, 589 F.2d 1114 (1979). Thus, the testimony of Thomas Bell laid the proper foundation for introduction of these documents under Rule 803(6).

Public Records

Although the short-landing certificate and survey reports were prepared by foreign entities, the decision of United States v. Lykes Bros. Steamship Co., 432 F.2d 1076 (5th Cir.1970) mandates that these documents also be considered public records of the United States within the meaning of Rule 803(8). In Lykes Bros., the Fifth Circuit Court of Appeals determined that an out-turn report and certificate of condemnation prepared by Korean officials were admissible as government documents in order to establish a prima facie case under COGSA. The Court reasoned that under the pertinent government regulations,⁴ the duty to prepare the report can be delegated to an independent agency or foreign government, without the report losing its reliable character, when submitted through the appropriate United States agency, as a report of a department or agency of the United States. Id. at 1079-80.

In the instant case, the short-landing certificate and cargo surveys prepared in compliance with government regulations are likewise sufficiently reliable to justify treatment as "public records". In fact, the reliability and trustworthiness of the evidence is enhanced by relying on the survey report of an independent expert, rather than the report of a survey conducted by the agency itself.

Tenaciously, Central Gulf argues that even if the documents are public records, they are still inadmissible because they were not properly "authenticated". "Authentication of the documents merely establishes their authorship, the proof of some human's `personal connection with a corporal object'". Rhoads v. Virginia-Florida Corp., 476 F.2d 82, 85 (5th Cir. 1973), after remand 549 F.2d 985 (1977).

By way of example, Rule 901(b)(7) explains that:

The requirement of identification as a condition precedent to admissibility is satisfied by evidence ... that a writing authorized by law to be recorded or filed and in fact recorded or filed in a public office, or a purported public record ... is from the public office where items of this nature are kept.

Again, the uncontroverted testimony of Thomas Bell, the custodian of the documents, serves to "authenticate" these documents. See Sternberg Dredging Co. v. Moran Towing & Transport Co., 196 F.2d 1002, 1005 (2d Cir.1952), rehearing denied 200 F.2d 603; Zenith Radio Corp. v. Matsushita Electric Industrial Co., Ltd., 505 F.Supp. 1190, 1223-24 (E.D.Pa.1980); McCormick on Evidence § 191 (1954).

III. PROPER PARTY?

Relying on United States v. Central Gulf Lines, Inc., 699 F.2d 243 (5th Cir.1983), a decision involving the S/S GREEN VALLEY, sistership of the GREEN ISLAND, the defendant-carrier contends that the proper party to bring a claim for shortage is CLUSA—the consignee—and not the CCC, through the United States. The above cited case is distinguishable for a number of reasons.

In Central Gulf Lines, another United States agency, the Agency for International Development, transferred the title to consignments of urea to the South Vietnamese government prior to the shipment of the urea to Saigon. The transaction was characterized as a "loan". Id. at 244. A survey of the cargo during discharge revealed a shortage, and the United States made demand on Central for the value of the missing urea. The court disallowed any claim on behalf of the United States for the value of the missing urea, because the South Vietnamese interests had title to the cargo at the time of shipment. Thus, the court reasoned:

The United States, because it was not the owner of the missing urea, received no assignment of claim by the owner, and enjoyed no guarantee of loan payment by Central, has no interest entitling it to recover from Central the value of the urea.

Id. at 245.

Conversely, in the instant case, the United States retained ownership of the missing soybean oil until received by the consignee, CLUSA.⁵ Since CLUSA never received the cargo in question, CLUSA never possessed title to it.

Furthermore, 22 C.F.R. § 211.9(2)(i)(1983) grants a statutory assignment of claim when the CCC ships commodities under the Food for Peace Program.⁶

Finally, in Central Gulf Lines, the United States was not a signatory to the contract of carriage. 699 F.2d at 245. In the case at bar, the United States, through the CCC, is a signatory to the contract of carriage, the breach of which forms the basis of this suit. See also United States v. Waterman Steamship Corp., 471 F.2d 186, 189 & n. 4 (5th Cir.1973), wherein the signatory to the bill of lading was CARE, a private organization.

IV. LIABILITY

In a case controlled by COGSA, the placement of the burden of proof is crucial. Socony Mobil Oil Co. v. Texas Coastal & International, Inc., 559 F.2d 1008, 1010 (5th Cir.1977...