Petition for a Writ of Certiorari — Horn v. Cia de Navegacion Fruco, S. A.

LIBRARY FILED

@UPREME COURT i &

= JAN 30 1969

—SHW-F-DAVIS. BLERK

IN THE

SUPREME COURT OF THE UNITED STATES.

OCTOBER TERM, 1968.

+ GER E85 68 8

HEINRICH C. HORN,

Petitioner,

VS.

CIA DE NAVEGACION FRUCO S. A. and J. R. ATKINS, d/b/a

ALABAMA FRUIT AND PRODUCE CO.,

Respondents.

PETITION FOR WRIT OF CERTIORARI

To the United States Court of Appeals

for the Fifth Circuit.

HEINRICH C. HORN, Petitioner, —

By JOHN H. TAPPAN,

510 Van Antwerp Building,

P. 0. Box 2245,

Mobile, Alabama 36601,

Counsel for Petitioner.

Sr. Louts Law Printrne Co., Inc., 411-15 N. Bighth St., 68101. CE%&ntral 21-4477.

>

TABLE OF CONTENTS.

Page

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Bees SORENUD GOP TROND 6 ones cc cscuessvnsescsesss 2

Bs PE CTE in bene dcncesvonsesesssensess 3

Ws COUOENE GE CS CRUD cc aie wencecccsnescccccess 4

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Appendiy A--:

Judgment on rehearing in the United States Court

of Appeals for the Fifth Circuit, November 35,

BEE 66066 ha nbn ekene ies 5weneeseeéenevareedas A-1

Substitute opinion and decision of the United

States Court of Appeals for the Fifth Circuit,

-, , Vi dish a wbeeednavneeesecnss A-3

Appendix B—

Opinion of the United States Court of Appeals for

the Fifth Circuit, June 28, 1968 .............. A-35

Appendix C—

Opinion of the District Court .............0..008. A-60

Appendix D—

Carriage of Goods by Sea Act .......... cc cee A-72

Appendix E— )

BS errr ree rere eT TTT ee A-85

Appendix F—

Letter te Captain M/S ‘‘HEINZ HORN”’’ from

SE UND Ei, NEE 4.55 455 0006405 6456 Keke a0 eas A-88

le aa

ii

Appendix G—

Letter from German Counsel, July 22, 1968 ...... A-91

Appendix H—

Extracts from Relevant Charter Party aad ex-

tracts from opinions from Canadian Transport

Co. v. Court Line, Ltd., House of Lords, 1940

ere er Teer eT eT Teer ere A-93

Cases Cited.

Albers Bros. Milling Co. v. Hauptman, 95 F. (2d) 286

eer errr rrr 20

American Tobacco Co. v. The Katingo Hadjipatera,

194 F. (2d) 449, modifying the District Courts’ de-

cision in 81 F. Supp. 488, certiorari denied, 343

ok Ee nos uaebeahucawsessecnesenes ee enes 16, 18, 19

Badrena e. Hijo, Inc. v. SS Rio Iguazu, 182 F. Supp.

885, 1960 A. M. C. 2028 (District Court, Eastern

District of Louisiana, 1960) 2.0... ccccccccscccess 20

Bull v. New York & Porto Rico S. S. Co., 167 Fed.

Gee Sabo bibs 60 u55 560 bes we ada ie shee deen he 08s 16

Canadian Transport Co., Ltd. v. Court Line, Ltd.,

House of Lords 1940, A. C. 934, 64, Lloyd’s Law

Bee CTE Ge none aces ccnsvsncesceeeeesttseess 17

Compagnie de Navigation, ete. v. Mondial United

Corp., 316 F. (2d) 163 (5 CCA, 1963) .......... 18, 20

Cullen Fuel Co. v. Hedger Co., 290 U. S. 82 (1933) 12

Daido Line v. Thomas P. Gonzalez Corp., 299 F. (2d)

Be Gr ey EE bas ckeaeeecindeecsdscevenceses 20

Erie & St. Lawrence Corp. v. Barnes-Ames Com-

pany, 52 F. (2d) 217 (W. D. N. Y. 1931) ........ 12

Hecht, Levis & Kahn, Inc. v. SS President Buchanan,

206 F. (3d) GBF (3 COA, TGS). ...cccvccevesscsss 19

ili

Isbrandtsen Co. v. George S. Boutwell, 1958 A. M. C.

DE eae bewecscnbcwnSeewsdtwasdceesoceeeecwansess 16

May v. Hamburg Amerikanische Packetfahrt Aktien-

gesellschaft, 1933, 290 U. S. 333 ..............005- 8

McAllister v. United States, 348 U. S. 19 .......... 12, 21

Oxford Paper Co. v. The Nidarholm, 1931, 282 U. S.

DE ka wkke ROCRNEieh eee kes Ch bGK00e se eceehedenenes 16

The Framlington Court, 69 F. (2d) 300 ............ 8

The Niel Maersk, 91 F. (2d) 932, 1937 A. M. C. 975 (2

CCA), certiorari denied sub nom, Bradley v. Niel

eG SE Os UE Ans knee eben cass scneeeg dene 19

The Oritani, 40 F. (2d) 522; affirmed by adopting the

District Court’s opinion, 54 F. (2d) 1075 .......... 1d

Tee TE, Be HD hhc ceccvccesessasnees 16, 17

The Steel Navigator, 23 F. (2d) 590 (2nd Cir. 1928) 12

The St. Cuthbert; West Indies Food Importing, Inc.

v. Cohana Shipping Corp., 1966 A. M. C. 1637 (Dis-

trict Court, Southern District of Florida, 1966) .. 20

The Thomas P. Beal, 11 F. (2d) 49 ........cccccees 16

Statutes Cited.

ee Sea: SE OE Cok coccnseueseckccbenseuer 2

46 U.S. C., Sections 190 through 195 ............... +

Oe Te te eg I SE bc ce ves 60 cvceekiescxebanys 3

Se We We ee ME GEE 0 osc eens SN enecsccécecsvins 3

1

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ee ay

IN THE

SUPREME COURT OF THE UNITED STATES.

OCTOBER TERM, 1968.

eeyerar

HEINRICH C. HORN,

Petitioner,

VS.

CIA DE NAVEGACION FRUCOQ S. A. and J. R. ATKINS, d/b/a

ALABAMA FRUIT AND PRODUCE CO.,

Respondents.

PETITION FOR WRIT OF CERTIORARI

To the United States Court of Appeals

for the Fifth Circuit.

To the Honorable, the Chief Justice and the Associate

Justices of the Supreme Court of the United States:

The Petition of Heinrich C. Horn, Petitioner, respect-

fully shows to this Honorable Court:

I.

EARLIER REPORTS.

A. This is a Petition to the United States Circuit Court

of Appeals for the Fifth Cireuit and specifizally to its

Opinion dated November 5, 1968. This Opinion is set out,

in full, in Appendix A to this petition. This Opinion has

not yet been reported.

Ve ee? oe)

LONER PTE RPS INT Ae 2 IE SPE NAY

NTO CAI ERLE ON Cote IW

pan

B. The Court of Appeals Opinion of November 5, 1968,

was preceded by that Court’s Opinion of June 28, 1968.

The Opinion of June 28, 1968, is set out in full in Ap-

pendix B to this Petition. The Opinion of June 28, 1968,

has not been reported.

C. The Opinions of June 28, 1968 and November 5,

1968, result from cross appeals from an Opinion of the

United States District Court for the Southern District of

Alabama of September 14, 1964 and is reported in 233 F.

Supp. at page 637. Said Opinion is set out, in full, in

Appendix C to this Petition.

Il.

JURISDICTION.

A. The date of the judgment sought to be reviewed is

November 5, 1968, on which day it was entered.

B. The Opinion and judgment of November 5, 1968, is

an Opinion resulting from cross-petitions for rehearing

resulting from the opinion of the Court of Appeals of

June 28, 1968.

C. This Honorable Court has jurisdiction under the

terms of Section 1254 of Title 28, of the United States

Code.

III.

QUESTIONS AT ISSUE.

As is set out more fully below, the controversies which

are here presented arise out of the carriage of certain

cargoes of bananas from Ecuador to Mobile, Alabama.

The carriage of the bananas was in 1962 aboard the

HEINZ HORN, owned by your Petitioner, while she was

under charter to Cia de Navegacion Fruco (hereinafter

referred to for convenience as ‘‘Fruco’’), one of the re-

spondents herein. Under the terms c* said charter, the

a ee

HEINZ HORN performed a total of five voyages and the

controversies involve cargo carried on the first and fourth

of these voyages. (In addition, during the same time, the

MARIE HORN, a sister ship of the HEINZ HORN, per-

formed three voyages under the terms of a charter party

with Fruco of substantially identical terms.)

The questions presented for review are as follows:

A. Was the Court below ccrrect in concluding that

Heinrich C. Horn (hereinafter referred to as ‘‘Horn’’),

Petitioner, failed to use due diligence to make the HEINZ

HORN seaworthy at the start of the first voyage?

B. Was the Court below correct in concluding that

Horn failed to carry his burden of proving an absence of

causation between the unseaworthiness and the damage

which resvlted on the first voyage?

C. Was the Covri below correct in concluding the faulty

stowage, and the resulting loss of cargo, was the responsi-

bility of Horn? Is the charterer, Fruco, not primarily

liable?

D. Was the Court below correct in concluding there was

no inherent vice or defect in the bananas carried on the

fourth voyage of the HEINZ HORN?

FE. Was the Appellate Court correct in reversing the

District Court’s conclusion that Horn is entitled to charter

hire for the time the charterer placed the HEINZ HORN

off hire after the first voyage?

IV.

STATUTES INVOLVED.

The case involves the Carriage of Goods by Sea Act,

found in Title 46 of the United States Code, Sections 1300

to 1315. This Act is set out in full in Appendix D to this

Petition.

a

It is thought that the Harter Act, found in Title 46 of

the United States Code, Sections 190 through 195, is not

actually involved in this case. However, as some com-

ments refer to that Act; and as certain of the authorities

ciived by the Court below are dependent on that Act, it

is set out in full in Appendix E to this Petition.

Ve

STATEMENT OF THE CASE.

On April 30, 1962, Cia de Navegacion Fruco, S.A.,

entered into a charter of the ITAINZ HORN, a German

flag vessel, owned by Petitioner, using a New York

Produce Exchange Charter Party. The charter contem-

plated the carriage of bananas from Keuador to the Gulf

Coast of the United States. The HEINZ HORN actually

went on charter, under the terms of this cliarter, on the

3rd day of June, 1962, at Mayaguez, Puerto Rico.

Before leaving Mayaguez, the HEINZ HORN was sur-

veyed by the German Lloyd’s Society for her classifiea-

tion, and a new certification was issued dated June 3,

1962.

The HEINZ HORN (as is her sister ship, the MARIE

HORN) is a small, two hold, refrigerated vessel, of 915

metric tons dead weight capacity, built in 1958 (four

years before this controversy arose), She is capable of

about 60 air changes per hour when the holds are empty,

and of maintaining temperatures down to minus 20 de-

grees centigrade in all holds, Her refrig ration equip-

ment is located in a refrigeration house between No. 1 and

No. 2 holds, serving both of them, The method of dis-

tribution of the cold air consisted of foreing the air

down through a canal to be distributed forward from

the after bulkhead of the lower No, 1 hold and aft from

the forward bulkhead of the No. 2 hold. The refrigerated

air moved ft’ rough the lower holds in opposite directions,

a ean

up into the tweendeck space and back to the bulkheads

between the two holds where it was recooled or ex-

hausted, as the case may be. The direction of the flow

could be reversed and, on occasion, was,

There were distance thermometers located at different

places in each hold which could be read in the engine

room. In addition, there was a temperature gauge for

reading the delivery air going into the holds; and two

temperature gauges for reading redelivery air, coming

out of the holds, These temperature gauges were regu-

larly read (when the refrigeration was in operation) and

the temperature readings were recorded both in a deck

refrigeration log book, and in an engine room refrigera-

tion log book. These readings and entries were made

at least at hourly intervals during the carriage of ba-

nanas,

Furthermore, at least once each day, the pulp tempera-

ture of the bananas was taken, This was accomplished

by a man going through the refrigeration house into

the tweendeck space and the lower hold of each hold,

immediately by the bulkhead between the two holds,

which goes under the refrigeration house, and actually

inserting a thermometer in a banana, and taking a read-

ing after the temperature in the thermometer had been

lowered to that of the pulp of the banana. These pulp

temperatures were not recorded unless there was some-

thing unusual or out of the way about them, and there

is no evidence to the effect that there was anything un-

usual about the pulp temperatures taken during the

course of the voyage.

At the time the HEINZ HORN went on charter, her

Master was Captain Horne (the Appellate Court spells

this ‘‘Iforn’’; the similarity of name with Petitioner is

coincidence); she had two mates, three licensed engineers

and three junior engineers. The engineers operated the

refrigeration machinery, Subject to the change noted

Pee ee soe eee

PET a:

pam Sane

below, this was the officer situation on the vessel through-

out the period of charter.

At the Canal Zone, en route to her first loading, the

HEINZ HORN picked up a representative of respondents,

Mr. Christian, Horne understood him to be a supereargo,

and so carried him on the ship’s articles. Subsequently

respondents characterized him as an untrained observer.

He remained aboard through the loading and the first

voyage,

After the HEINZ HORN had loaded and was on her

first voyage from Eueador to Mobile, Captain Horne be-

came ill, and it was decided to take him off the ship,

which was done at the Canal Zone. The voyage was

completed from the Canal Zone to Mobile under the

command of Mr, Schultz, who held a Captain’s license.

At Mobile, Captain Freytag met the vessel and took over

the command, There is no evidence that the illness and

subsequent absence of Captain Horne in any way con-

tributed to the condition of the cargo as it was found

on arrival in Mobile on June 21, 1962,

Before the HEINZ HORN arrived in Puerto Bolivar,

she commenced pre-cooling her holds, and got them to

about 42° F. According to the loading report submitted

by Commercial Latino Americana, S. A., the shipper and

stevedore, which acted for Fruco, loading started at 1950

on June 11; it stopped at 0280 of June 11 (this is prob-

ably a typographical error; we suspect this was June 12);

and commenced again at 0835 of June 12 and continued

thereafter until 0100 of June 13. Thus, more than half of

the loading was done at night. According to this loading

report, a total of 3,539 stems of bananas were loaded in

No. 1 hold and 2,009 boxes of bananas were loaded in that

hold; whereas, 11,866 boxes of bananas were loaded in

No. 2 hold. This exhibit also discloses that the shipment

was supervised by Mr. Turner, Manager; C. A. Margues,

T., Chief Loading Officer: two selectors, two talleymen,

a, Foe

two weight checks. and one stowage supervisor. It fur-

ther discloses, in detail, the location aboard the vessel in

which the bananas were stowed by two gangs, totaling

100 men.

At the time of loading, bin boards, which had been in

No. 2 hold were removed, although they were left in No.

1 hold. Mr. Schultz has said that he had had no experi-

ence with shipping bananay in boxes, though the vessel

had often carried bananas in stems, and that the bin

boards were removed (which ordinarily wouid separate

the hold into smaller compartments) because this is the

method customarily used by the charterer in carrying

bananas in boxes as he was informed by Mr. Christian

and the loading stevedores.

This is in line with the instructions given by the char-

terer in its letter of instruction of June 1, 1962, in which

it is said:

“*. . . We have been loading these boxes in our own

vessel, MARTHA ANNE, and our experience in car-

rying the fruit in boxes has been very good, therefore,

you should have no difficulties providing you follow

our instructions.’’ (This letter, in full, is Appendix F

to this Petition.) |

The bananas were brought from the shore alongside the

vessel in barges. From the barges, gangways were erected

to the vessel; and on the vessel, into the holds. Men,

carrying a box of bananas, would run up the gangway to

the deck of the vessel, down a gangway into the hold, and

stow the cargo. These were the 100 men in the employ

of Latino Americana, the shipper and stevedore.

The HEINZ HORN sailed from Puerto Bolivar early

on the morning of June 18, and except for the illness of

Captain Horne, her voyage from Puerto Bolivar to Mobile

was uneventful. The instructions of Fruco to de-gas the

holds every six hours were followed. The HEINZ HORN

EPL ICS

= a

arrived in Mobile late on June 21 and discharging com-

menced at 8:00 on the morning of June 22, 1962.

The problem arose by reason of the cargo in the No, 2

hold. It is to be noted that all of the cargo in the No, 1

hold was accepted and sold. The cargo, in boxes (or

cartons), in No, 2 were found to have a pulp temperature

which, depending on the witness or the location of the

banana, ranged frem 56 to 62 degrees.

Mr. Schultz points out that in the boxes, packed before

the boxes came aboard the vessel, there were ripe bananas

in with green bananas.

The District Court found the HEINZ HORN seaworthy.

It went on to conclude that the vessel failed to use due

diligence to insure the safe carriage of the bananas in

that the officers failed to cause the bananas to be stowed

preperly and failed to exercise due diligence in promptly

pulling the air temperatures down and maintaining the

delivery and return air temperature at the desired level.

On these conclusions, the District Court allowed a_ re-

covery from Horn of $31,261.64 with interest.

In its decision of June 28, 1968, the Court of Appeals

reversed the District Court’s finding that the HEINZ

HORN was seaworthy, finding that she was unseaworthy

with respect to her crew, and, relying on this Honorable

Court’s decision in May v. Hamburg Amerikanische Pack-

etfahrt Aktiengeselischaft, 1933, 290 U. S. 333, and its

own decision in The Framlington Court, 69 F. (2d) 300,

concluded it was not necessary to show causal relation be-

tween the defect (unseaworthiness) and the loss, and

stated the effects of the improper stowage have no bearing

on petitioner’s liability in view of this determination. In

the Appellate Court’s revised opinion of November 5,

1968, the Appellate Court further concluded that Horn has

failed to carry its burden of proving an absence of causa-

tion between the unseaworthiness and the loss. It further

—

concludes the primary cause of damage on the first voyage

was the improper stowage of the bananas; that the ship’s

officers were acting for Horn, the Owner, rather than

Fruco, the Charterer, in regard to decisions made touching

this stowage. It affirms the District Court’s conclusion of

liability of petitioner.

On May 15, 1962, Fruco entered into an agreement to

charter the MARIE HORN, a sister ship of the HEINZ

HORN, also under a New York Produce Exchange Charter

Party. The charter party for the MARIE HORN did not

differ in any material respect from that for the HEINZ

HORN,

The HEINZ HORN continued operating under the char-

ter with Fruco for 2 total of five voyages (voyage here

referring to a trip from Ecuador to Mobile with a cargo

of bananas) and the MARIE HORN operated for a total

of three voyages.

The only other voyage, of those just mentioned, from

which claim arose for. ripe or turning bananas, was voy-

age four, of the HEINZ HORN. There was involved here

a shipment of 8,170 stems of bananas, a substantial portion

of which were loaded after dark, aboard the HEINZ

HORN on or about September 2, 1962 at Guayaquil, an-

other loading port a short distance from Puerto Barrios,

in Ecuador.

As to this voyage, the controversy touching loading or

stowage does not exist. Evidence from the ship is to the

effect that on the 2nd and 3rd day out of Guayaquil, on

the way to Mobile, inspections were made in the tween-

deck and lower holds of the vessel, and a total of 335 stems

of bananas were found to be ripe already, and were jetti-

soned in an effort to prevent the ripening of other fruit.

On the vessel’s arrival in Mobile, Mr. Atkins claimed

some 56% of the bananas were ripe or turning. The Mas-

ter issued a bill of lading without exceptions. At the trial,

—_— 10) —

a loading report, prepared by Frutera Ecuatoriana another

shipper and stevedore in Ecuador, acting for Fruco, was

introduced over objection. These constitute the only evi-

dence introduced as to the good condition of the cargo on

loading.

On this voyage, the delivery air reached 52° within

eight hours after the hatches were closed where it re-

mained. In this regard, reference is made to the letter of

instructions from Fruco to the Master of the HEINZ

HORN of June 1, 1962, Appendix F.

Again the District Court found that the HEINZ HORN

was seaworthy. It further found there was no proof of

inherent defect, quality, or vice of the cargo. It concluded

the HEINZ HORN failed to use due diligence to insure the

safe carriage of the cargo in that the officers failed to

cause the bananas to be stowed properly and promptly to

pull the air temperature down and maintain a delivery

and return air temperature at vc desired level. It con.

cluded that Horn was responsible for damage in the

amount of $18,495.73, plus interest.

In its opinion of June 28, 1968, the Court of Appeals

affirmed the District Court’s finding that the HEINZ

HORN was seaworthy; it also affirmed the Court’s finding

that there was no proof of inherent defect in the cargo; it

concluded the District Court erred in finding an absence of

diligence in the stowage of the bananas; it concluded that

the refrigeration clause, incorporated in the charter party,

prevented a recovery from Horn on this voyage, and re-

versed the District Court’s award of damages against

Horn.

In its revised opinion of November 5, 1968, the Court

of Appeals affirms its earlier decision in all respects ex-

cept this: by reason of the incorporation of the Carriage

of Goods by Sea Act in the charter party under the terms

of the U. S. Clause Paramount, Cogsa has the effect of

eliminating the refrigeration clause as a defense available

on

to Horn. It thereupon affirms the recovery the District

Court allowed against Horn for the fourth voyage.

Following the discharge of the HKINZ HORN in Mobile

on June 22, 1962, no orders were given for the sailing of

that vessel until June 29, 1962, or which were effective

until June 29. During this time the HEINZ HORN was

drydocked and was on her owner’s time for a period of

just over a day.

The charterer viewed the HEINZ HORN as having been

off hire for the entire period between June 22 and June

29 and deducted $4,327.73 from the charter hire of the

HEINZ HORN. The District Court, after allowing the

charterer a credit of $674.44 for the period the HEINZ

HIORN was drydocked, allowed the owner of the HEINZ

HORN recovery of $3,651.29, plus interest, for this failure

to pay charter hire.

Thereafter, when the HEINZ HORN arrived in Puerto

Bolivar for her second voyage, the charterer placed the

HEINZ HORN off hire for two more days because the

vessel didn’t arrive in time for loading and cargo was not

ready at the time it arrived, because of this delay. The

amount deducted for charter hire for this period was

$1,266.66 at the rate of $633.33 per day. As it was the

charterer, and not the owner who decided when the

HEINZ HORN was to sai! from Mobile, the District Court

also al:owed recovery of this charter hire withheld, plus

interest.

The Court of Appeals in both its opinion of June 28,

1968, and its revised opinion of November 5, 1968, re-

versed the District Court. It grounded its reversal on

Clause 15 of the charter party stating that the charterer

is not liable for payment of hire for time lost from ‘‘de-

ficiency of men’’, and that the time lost resulted from the

delay in disposing of the damaged bananas, which in turn

had been damaged by reason of inadequacy of personnel.

POPPA CLT RIA PRT EEO os + RE ee

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VI.

ARGUMENT.

A. 1. There is no support for the conclusion of the Court

of Appeals that a vessel is to be deemed unseaworthy at

the start of the voyage unless the owner insure that ade-

quate and competent personnel will remain on board

throughout the voyage. Such a conclusion is in direct

conflict with the decisions of tis Honorable Court, Cullen

Fuel Co. v. Hedger Co., 290 U. S. 82 (1933), and the de-

cisions of other courts, The Steel Navigator, 23 F. (2d)

590 (2ad Cir. 1928); Erie & St. Lawrence Corp. v. Barnes-

Ames Company, 52 F. (2d) 217 (W. D. N. Y. 1931).

2. (a) The Court of Appeals in concluding that the Dis-

trict Court erred in finding the vessel seaworthy reversed

that Court when there was substantial evidence support-

ing the District Court’s conclusion. McAllister v. United

States, 348 U. S. 19.

(b) The evidence supporting the District Court is as fol-

lows: At the time of breaking ground, the HEINZ HORN

had a Master, Captain Horne, and two Mates; she had

three Engineers; and three Junior Engineers. The Engi-

neers had the actual responsibility for operating the re-

frigeration machinery.

It is true that Captain Horne left the vessel at the

Canal Zone on the voyage from Bolivar to Mobile, by rea-

son of illness. Neither of the Courts below found he was

ill at the time the vessel broke ground. In fact, Mr.

Schultz, the only person who testified in regard to Captain

Horne’s condition, said the following:

Q. ‘‘When you were asked about what his condition

was or what was wrong when he left the ship at the

—

Canal Zone, you said that you didn’t know, that you

were not a doctor to diagnose the condition. Did he

suffer from any illness at the time the cargo was being

loaded while the vessel was in Puerto Bolivar?

A. “In Bolivar he was very healthy, and we were

pleased because he was so good, because he was sick

on previous voyages, not that he had to lie in bed,

but he didn’t feel well. Sometimes he had stomach

pains and so on. In Bolivar he was really fine, he

could eat everything and drink everything and was

walking along the deck and looked very well.

Q. ‘‘Then he must have gotten ill ketween Bolivar

and the Canal Zone.

A. ‘On the way to the Canal Zone he became

seriously iil.’’

That the HEINZ HORN sailed with a Master and two

Mates is consistent with the requirement of the law of

the German flag under which she sailed. Attached, as

Appendix G to this Petition, is a letter from the German

Consulate General dated July 22, 1968, to Lamorte, Burns

& Co., Inc., stating the applicable German Code requires

a Master and only two Mates for a vessel of the class

of the HEINZ HORN, together with relevant portion

of the Code referred to and our trauslation.

The charter party of the HEINZ HORN states:

‘¢. . . the vessel is intended to be employed in the

banana trade between good and safe port Ecuador

. and safe ports US Gulf and/or US Atlantic.’’

This is the actual contract for the employment of the

vessel. Nothing in the contract of hire for the vessel

calls for the carriage of bananas ‘‘in boxes’’, As noted

in the testimony of Mr. Schultz and Captain Freytag,

this same vessel with the same personnel has quite suc-

cessfully carried bananas on voyages approximately twice

the length of the voyage contemplated here.

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Thus, and with specific reference to the numbered items

found by the Appellate Court, page A-15, Appendix A,

the HEINZ HORN, at the tinie she broke ground in

Bolivar:

(1) Had aboard a Master in good health;

(2) Had a normal complement of a Master, two Mates,

three Engineers, three Assistant Engineers, as required

by the applicable German law;

(3) Had aboard officers who bad successfully carried

bananas on voyages for twice the length here contem-

plated;

(4) After the Master left the vessel at the Canal Zone,

had aboard not only two Mates, but three Engineers,

and three Junior Engineers;

(5) The acting Master not only had prior experience

as Captain of a refrigerated vessel, but had successful

experience in the carriage of bananas.

3. That the HEINZ HORN was, in fact, seaworthy is

shown by the fact that she did carry an acceptable cargo

of bananas in her No, 1 hold; the same refrigeration ma-

chinery serving both holds and operated by the same

personnel. This acceptable outturn of bananas from hold

No. 1, on voyage one, refutes any conclusion that inade-

quate personnel was the cause of ripening bananas in

No, 2 hold.

Captain Freytag, who joined the vessel at the time she

arrived in Mobile completing her first voyage, and was

present at the time the hatches were opened, said re-

peatedly that there was no question about the acceptabdie

condition of the cargo in No. 1 hold.

All the other witnesses called, including Fruco’s sur-

veyor, the representative of the United States Depart-

— von

ment of Agriculture and Mr, Atkins’ employee entrusted

with unloading the cargo, testified only as to the unac-

ceptable condition of the cargo in No, 2 hold. Mr. Atkins’

employee in fact testified as to the acceptable condition

of the fruit stowed in both boxes and stems in No, 1 hold.

The significance of this uncontradicted testimony is

that the HEINZ HORN, on the same voyage, using the

same machinery and the same personnel, outturned a

good cargo of bananas from hold No, 1, and ripening

bananas out of hold No, 2. If the same personnel operate

the same machinery on two holds at the same time, only

one of which outturns unacceptable bananas, there must

have been some cause other than personnel or machinery

which brought about the ripening bananas,

B. Was the court below correct in concluding that

Horn has failed to carry his burden of proving an ab-

sence of causation between the unseaworthiness and the

cargo damage which resulted on the first voyage?

On the question of on whom rests the burden of proof

of the cause of the damage, the Courts of Appeals are in

conflict. In The Oritani, 40 F. (2d) 522; affirmed by

adopting the District Court’s opinion, 54 F. (2d) 1075,

the Third Circuit Court of Appeals has held that the

cargo libelant has the burden of showing that the unsea-

worthy condition is the proximate cause of the loss (40

F. (2d) p. 529). In the instant case, the Court of Ap-

peals has stated that the shipowner has failed to carry

its burden of provirg an absence of causation between the

unseaworthiness and loss.

Proof touching causation (or the lack of it) arises out

of this: the HEINZ HORN on the same voyage, using

the same machinery and the same persomel, outturned a

good cargo of bananas from hold No. 1, and ripening

bananas out of hold No, 2.

DORR a eS TRO OF

-_

It is to be noted that there is no evidence in the ree-

ord that the cargo carried in the No. 1 hold on voyage

one was other than acceptable, and this includes evidence

from the charterer and from the consignee.

C. Was the Court below correct in concluding the faulty

stowage and resulting loss of cargo, was the responsi-

bility of Horn, the ship owner?

This conclusion is in conflict with the conclusion

reached by the Third Circuit Court of Appeals in The

Thomas P. Beal, 11 F. (2d) 49. It is in conflict with

decisions of the Second Cireuit Court of Appeals: Bull v.

New York & Porto Rico 8. 8. Oo., 167 Fed. 792; Ameri-

can Tobacco Co. v. The Katingo Hadjipatera, 194 F. (2d)

449, modifying the District Courts’ decision in 81 F. Supp.

438, certiorari denied, 343 U. S. 978; and with numerous

District Court decisions in the Second Circuit. See, e. g.,

The Santona, 152 Fed. 516, Isbrandtsen Co. v. George 8.

Boutwell, 1958 A. M. C. 351. It is incompatible with this

Honorable Court’s decision in Oxford Paper Oo. v. The

Nidarholm, 1931, 282 U. S. 681.

It is true the Court of Appeals in its decision of No-

vember 5, 1968, states the rule to be:

“The Captain occupies a dual role with regard to

such decisions. He acts for the ship owner where

his stowage decisions are made with regard to the

seaworthiness and safety of the vessel; he acts for

the cargo owner where his decisions do not affect

the seaworthiness or safety of the vessel, but affect

the safety of the cargo only.”’

Petitioner does not find fault with the statement of the

rule as set out by the Court of Appeals; the problem

arises by reason of the failure of the Court of Appeals

to apply the rule in this situation in which the stowage

— poe

of the cargo was concerned with the safety of the cargo

only. It is difficult to conceive of a factual situation in

which the second portion of the rule, aptly stated by the

Court of Appeals, would have application if it does not

have application to the situation here presented.

Admittedly, in the absence of contract, the ship owner

is responsible for the cargo. Here the obligation properly

to stow is placed on the charterer under the terms of

Clause 8 of the charter party which is set out as Ap-

pendix H to this petition. To Appendix G, we add quo-

tations from the opinions of Lord Atkin, and Lord Porter

in the decision reached by the House of Lords in Cana-

dian Transport Co., Ltd. v. Court Line, Ltd, House of

Lords 1940, A. C. 934, 64, Lloyd’s Law List Reports 57.

Ilere the House of Lords unanimously concluded that

Clause 8 in a charter party there under consideration,

identical in terms to the one which was a part of the

charter party in the instant case, made the charterers,

not the owners, financially responsible for damage to

cargo resulting from faulty stowage.

In essence, the authorities cited on page 19 of this

petition reach the same conclusion, usually by the de-

vice, first introduced by Judge Hough in the Santona,

supra, of making the Master or officers of the vessel, the

representatives or agents of the charterer under the terms

of Clause 8 or similar charter party provisions, when

they are making decisions with regard to the loading or

stowing of the cargo which decisions are concerned with

the safety of the cargo.

The Court of Appeals has concluded Fruco may have

recovery of its loss to Atkins over against the vessel (on

the theory that cargo may libel the vessel in rem). We

agree with the Appellate Court that Atkins, as cargo

owner, may bring its action against the HEINZ HORN

in rem. Uowever, this does not take into consideration

. ee Sa

IE PO

—_ on

the fact that Fruco, as charterer, is a party to this action

and may also be liable to Atkins, and its liability can be

primary where as Horn’s liability is only secondary.

This situation existed in the Katingo Hadjipatera, 194

F, (2d) 449, affirming 81 F. Supp. 488, certiorari denied

3438 U. S. 978. The Court of Appeals in the Katingo

Hadjipatera states the facts are sufficiently stated in the

Opinion of the trial judge and, with the exceptions noted

in the Opinion on appeal, the evidence amply supports his

findings. Among the findings, not disturbed on appeal,

or on certiorari, are the following:

‘““SHIPOWNER’S CLAIM OVER AGAINST CHAR-

TERER. It is indisputable that the charterer not

only undertook the burden of stowage under the

charter party, but actually performed that duty

throughout. While the master retained an absolute

right to direct stowage, for which he is, vis-a-vis third

parties, always ultimately responsible, it is equitable

that as between the charterer and the ship, the char-

terer should bear the loss. Pioneer Import Corp. v.

The Lafcomo, supra, 138 F. 2d 907; The Thomas P.

Beal (3 CCA), 192€ A. M. C. 488, 11 F. (2d) 49; see

Oxford Paper Co. v. The Nidarholm, 282 U. S. 681,

685, 686, 1931 A. M. C. 522...”

The Fifth Cireuit has recognized the import of this

rule in Compagnie de Navigation, etc. v. United Mondial

Corp., 316 F. (2d) 163, 5 CCA, 1963. Here the cargo

owner was allowed to recover from the vessel tx rem, but

the Court went on to say:

“Tf this judicial peril is more than the own2r wants

to bear, he can by contract as between himself and

the user (charterer) shift the risk to a secondary one.

See American Tobacco Co. v. SS KATINGO HADJI-

PATERA (2 Cir., 1951), 194 F. 2d 449, 1951 A. M. C,

1933.’

_— wn

D. The Court of Appeals has affirmed the District

Court’s statement that ‘‘there was no proof of inherent

defect, quality or vice of the bananas”’ saying the carrier

must have shown some defect, quality or vice adhering to

the particular bananas brought aboard.

The only evidence showing the condition of the bananas

on loading is the clean bill of lading signed by the Master.

In turn, petitioner has shown that a substantial portion

of the bananas were loaded at night when the light was

inadequate to determine their color or firmness; that the

shipper did not cut a banana from each stem to determine

its softness, as was usually done; that on the second and

third day after sailing, the vessel found it necessary to

jettison a total of 335 stems of bananas because they were

ripening too fast; that the delivery air into the holds

where the bananas were carried reached 52° within the

eight hour period where it steadied and remained for the

balance of the voyage. (52° Fahrenheit is the lowest tem-

perature permitted under the terms of the instructions

from Fruco to Horn; it was achieved in a minimum of

time which could be anticipated.)

In these circumstances, the lower courts were in error

in placing the burden upon Horn to prove that there ex-

isted an inherent vice or defect in the.cargo. In so doing,

the lower courts are in direct conflict with contrary con-

clusions reached by the courts of the Second Circuit Court

of Appeals: The Niel Maersk, 91 F. (2d) 932, 1937

A. M. C. 975 (2 CCA), certiorari denied sub nom, Bradley

vy. Niel Maersk, 302 U. S. 753; American Tobacco Co. v.

Katingo Hadjipatera, 81 F. Supp. 438 (S. D. N. Y., 1948),

modified on other grounds, 194 F. (2d) 449 (2 CCA, 1951),

certiorari denied sub nom American Tobacco Co. v. Hadji-

pateras, 343 U.S. 978 (1952); Hecht, Levis & Kahn, Inc.

vy. 88 President Buchanan, 236 F. (2d) 627 (2 CCA,

1956).

— 20 —

In essence the rule as stated by the Second Circuit in

the foregoing cases is to the effect that, if the deteriora-

tion of the goods may have resulted from an inherent de-

fect, the shipper has the burden of proving their good

condition upon delivery to the carrier and to sustain that

burden he must present some evidence beyond a clean bill

of lading since the bill of lading is evidence only of the

apparent or external condition.

This rule has also been followed in the Ninth Circuit

Court of Appeals. See Albers Bros. Milling Co. v. Haupt-

man, 95 F. (2d) 286 (9 CCA, 1938); Daido Line v. Thomas

P. Gonzalez Corp., 299 F. (2d) 669 (G CCA, 1962).

The Fifth Cireuit Court of Appeals in Compagnie de

Navigation, etc. v. Mondial United Corp., 316 F. (2d) 168

(5 CCA, 1963), acknowledges the application of the rule,

at least with regard to the produce or similar natural com-

modities, when it says:

‘“Where because of the perishable or intrinsic nature

of the commodity, the internal condition is not ade-

quately revealed by external appearances, cargo may

have a considerable burden of going further to prove

actual condition .. .’’

District Courts within the Fifth Circuit have applied the

rule. See Badrena e. Hijo, Inc. v. SS Rio Iguazu, 182 F.

Supp. 885, 1960 A. M. C. 2028 (District Court, Eastern

District of Louisiana, 1960); The St. Cuthbert; West In-

dies Food Importing, Inc. v. Cohana Shipping Corp., 1966

A. M. C. 1637 (District Court, Southern District of Flor-

ida, 1966).

In the face of this authority, and despite the evidence

strongly indicating the bananas were already ripening at

the time they were loaded, the courts below have con-

cluded that Horn must fail because he has not carried his

burden of establishing inherent vice in the cargo loaded.

ae

ape AND ANY 2 Nd BASIN {TRIO le, I RI NR TLD RBLREMRL MNS Ce te wr

o—_ 31 —

EK. Was the Appellate Court correct in reversing the Dis-

trict Court's conclusion that Horn is entitled to charter

hire for the time the charterer placed the HEINZ HORN

off hire after the first voyage?

Agreeing with the District Court in this regard, the

Appellate Court said:

“There is no doubt that the charter party provided

that the ship sail on orders of the charterer.’’

It was because the charterer did not order the HEINZ

HORN to sail from Mobile until June 29, 1962, that the

District Court allowed Horn recovery of the charter hire

withheld for the intervening period (less the time of dry-

docking, admittedly at Horn’s expense), plus the two day

off hire time at Puerto Bolivar.

Although the record is replete with evidence of discus-

sions; possibly even recriminations; between the parties,

it is completely barren of evidence supporting the finding

of the Appellate Court that the time lost in Mobile re-

sulted from the delay in disposing of the damaged ba-

nanas, the basis for the Appellate Court’s reversal of the

District Court.

The conclusion of the Appellate Court is, therefore, in

direct conflict with McAllister v. United States, 1954, 348

U. S. 19.

CONCLUSION.

As the situation now exists, under the terms of the New

York Produce Exchange Charter Party, a form of charter

quite common in usage among the shipping community,

should cargo damage result from faulty storage, the ves-

sel’s charterer will bear the loss if the proceedings are

brought within the area of the Second Cireuit Court of

Appeals; should it be presented within the area of the

- bathe

— fen

Fifth Cireuit Court of Appeals, the loss will fall on the

shipowner.

In cases in which the question of inherent vice of the

cargo is raised, the shipper of the cargo must produce

some proof of the good condition of the cargo on loading,

other than a clean bill of lading in the Second and Ninth

Circuits; in the Fifth Circuit, the loss occasioned by cargo

with inherent vice will fall on the shipowner unless he is

able to prove the existence of the vice at the time of load-

ing, a proof which, in the ordinary course of events, is

quite beyond the shipowner’s ability.

These are questions of importance both to the shipping

and the insurance communities who are entitled to the

benefit of this Honorable Court’s conclusion with regard to

them.

It is therefore respectfully requested that the writ herein

prayed for be granted.

Respectfully submitted,

HEINRICH C. HORN,

JOHN H. TAPPAN,

His Counsel.