United States v. Lykes Bros. Steamship Co., Civ. A. No. 67-1692.
| Decision Date | 18 October 1968 |
| Docket Number | Civ. A. No. 67-1692. |
| Citation | 295 F. Supp. 53 |
| Parties | UNITED STATES of America, Plaintiff, v. LYKES BROS. STEAMSHIP CO., Inc., in personam, and the SS THOMPSON LYKES, her engines, tackle, etc., in rem, Defendants. |
| Court | U.S. District Court — Eastern District of Louisiana |
Kathleen Ruddell, Asst. U. S. Atty., New Orleans, La., Thomas L. Jones, Admiralty and Shipping Section United States Department of Justice, Washington, D. C., for plaintiff.
M. D. Yager, Terriberry, Rault, Carroll, Yancey & Farrell, New Orleans, La., for defendants.
Plaintiff United States of America seeks to recover, under the admiralty and maritime jurisdiction of this Court, damages from the defendants Lykes Bros. Steamship Co., Inc., and its vessel, the SS Thompson Lykes, for delivery of three shipments of bagged wheat flour and corn meal at the port of Kunsan, Korea in October 1966 in shortlanded, wet and otherwise damaged condition. Plaintiff alleged that it delivered the three shipments in good order and condition under three bills of lading1 to defendants between August 22 and August 30, 1966 at Orange and Houston, Texas and at New Orleans, Louisiana, that the shipments were not delivered at the port of discharge in the same good order and condition as when received and shipped, but on the contrary were damaged to the extent of $3,000 as nearly as could then be estimated. The plaintiff prayed for judgment in its favor for the amount of its claim, with interest and costs and a judgment of condemnation and sale of the SS Thompson Lykes to satisfy the judgment for damages. The defendant Lykes Bros. Steamship Co., Inc., answered claiming the SS Thompson Lykes, her engines, tackle, etc. and admitting only that the shipments had been delivered for transport at the ports designated by plaintiff and had been delivered at the port of discharge, but refused to admit to the allegations relative to condition of the shipments when received by them for transportation2 and denied the allegations that the shipments were delivered at the port of discharge in shortlanded, wet and otherwise damaged condition.3
In order for plaintiff to establish a prima facie case, it must prove that the goods were delivered to the defendant in good order, and that they were either not received or were received in a damaged condition. The burden of explanation and exoneration from fault is thereafter on the defendant carrier. Schnell v. The Vallescura, 293 U.S. 296, 303, 307, 55 S.Ct. 194, 79 L.Ed. 373 (1934); Copco Steel & Engineering Co. v. The Prins Willem Van Oranje, 159 F.Supp. 79 (E. D.Mich. 1957); Schroeder Bros. Inc. v. The Saturnia, 123 F.Supp. 282 (S.D.N.Y. 1954), aff'd 226 F.2d 147 (2d Cir. 1955); Gilmore and Black, The Law of Admiralty, § 3-43, pp. 162-163.
At the trial of the case the plaintiff attempted to prove by documentary evidence only, and without calling any witnesses, that when the SS Thompson Lykes arrived at Kunsan, Korea on October 10, and discharged its cargo during the period October 11 through 15, 1966, the cargo, because of the failure of the defendant Lykes Bros. Steamship Co., Inc., to properly care for it, suffered damage by torn bags, wet cargo and spoilage requiring rebagging. It was plaintiff's position that the cargo was thus delivered in a condition which breached the contracts of carriage and of defendant's duties and obligations as a carrier of merchandise by water for hire.
In addition to the three bills of lading, which were offered in evidence to show that the carrier received the cargo for shipment, the plaintiff offered for the purpose of showing the loss and damage of the shipments upon delivery at Kunsan, Korea the following documents:
The defendant objected to the admissibility of the documents on the ground that they were hearsay, having no trust-worthiness to show the condition of the cargo at the port of discharge, and that several of them were on their face of little or no probative value because they were undated, or dated at a time remote from the time of discharge of cargo and because they were not properly identified. The legal basis for the relative positions of the parties regarding the question of the admissibility of this evidence was not clear at that time. The Court therefore took the case under advisement for the purpose of determining the question of the admissibility of these documents with instructions to counsel to clarify their positions and provide supporting legal authorities and with the condition that, if the documents were found to be admissible so as to establish a prima facie case in favor of the plaintiff, the case would be reopened for the defendant to present its defense.
The authenticity of the documents had been stipulated by counsel before trial with the condition that they were subject to objections, if any, at the trial, other than to authenticity.
The Over, Short and Damage Report is identified at the top of the page as being made by "Far Eastern Co., Ltd.— Agent for Lykes Lines Agency, Inc." and therein the shipments examined are sufficiently described to identify them as the shipments covered by the bills of lading. The number of bags "found in stow" with covers torn requiring repacking is indicated as to each shipment and the missing and damaged contents are delineated. The Survey Report made by Inspection Company of Korea reports in detail the damage to the three shipments. In answers to the interrogatories propounded to it in the case, claimant-defendant Lykes stated that Far Eastern Marine Transport Co., Ltd. acted as husbanding agent for the vessel at the port of discharge, and caused Inspection Company of Korea to make the survey.
The plaintiff contends that these documents do not offend the hearsay rule because they are admissions by the agent for the principal and are admissible against Lykes in the same way that its own admission would be admissible. The defendant contends that before these reports made by agents can be considered as admissions by the defendant, the plaintiff must prove that the agent's authority to speak for the principal was included within the scope of the agency and that the agent was speaking to a third party for his principal rather than to his principal. The plaintiff does not deny that it has this burden, and apparently it could not successfully deny this because it appears to be well settled that it is only if the principal authorizes the agent to speak for him that he can make no valid exception to the reception of the agent's statements against him for the same reason that he could not take exception to the reception of his own admission. The fact that the agent reported to the principal a matter within the scope of his express authority does not make the matter therein admissible against the principal as an admission. If the principal expressly vouches for the report made to him, however, it is then considered as his statement and admissible, or if he is shown to have adopted or approved it the report likewise also becomes his statement.4
The plaintiff urges that in this case the reports are admissible as admissions against interest because they were incorporated by defendants into their answers to plaintiff's interrogatories, signed under oath by a vice-president of defendant Lykes. It contends that this follows from Rules 33 and 26(d) (2) of the Federal Rules of Civil Procedure5 as applied in the case of Gridiron Steel Company v. Jones & Laughlin Steel Corporation.6
Before trial the plaintiff directed twenty-eight interrogatories to defendant Lykes Bros. Steamship Co., Inc., which were answered by its vice-president R. T. Reckling. The interrogatories and answers pertinent to the issue here are as follows:
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