The Milwaukee Bridge, 26 F.2d 327 (2d Cir. 1928)

*328 *329 Kirlin, Woolsey, Campbell, Hickox & Keating and Bigham, Englar & Jones, all of New York City (D. Roger Englar, Ira A. Campbell, Alfred Ogden, and Roger B. Siddall, all of New York City, of counsel), for appellants.

Charles H. Tuttle, U. S. Atty., of New York City (William E. Collins, Sp. Asst. U. S. Atty., of New York City, of counsel), for the United States.

Choate, Larocque & Mitchell, of New York City (Joseph Larocque, of New York City, of counsel), for appellee Cory Bros. & Co., Limited.

Davis, Polk, Wardwell, Gardiner & Reed, of New York City (Theodore Kiendl, of New York City, of counsel), for appellee American Trading Co.

Rushmore, Bisbee & Stern, of New York City (Bertram F. Shipman, of New York City, of counsel), for appellee Haight Receiver of Butterworth-Judson Corporation.

Before MANTON, SWAN, and AUGUSTUS N. HAND, Circuit Judges.

AUGUSTUS N. HAND, Circuit Judge (after stating the facts as above).

The drums of sulphuric acid were lawful cargo, but possessed dangerous potentialities. They were properly stowed on deck, which was the usual place for such cargo. Unless there was negligence on the part of the ship in stowage, custody, care, and proper delivery of its cargo, *330 everything that happened while the cargo was within its control came within the exceptions in the bills of lading. In such circumstances, the burden of proving negligence was upon the shipper. The Isla de Panay, 267 U.S. 260, 45 S. Ct. 269, 69 L. Ed. 603, affirming (C. C. A.) 292 F. 723; The Bencleuch (C. C. A.) 10 F.(2d) 49; The Arpillao (C. C. A.) 270 F. 426; Dolbadarn Castle (C. C. A.) 222 F. 838; Konigin Luise (C. C. A.) 185 F. 478.

There are, of course, cases like C. Lopez y Lopez (C. C. A.) 297 F. 457, where the character of the damage indicates bad stowage. There oil was found to have damaged a cargo of cork. It was denied that the oil was stowed near the cork, but this court held that the presence of the oil on the cork showed the proximity, and that stowage of cork next oil containers which might leak was negligent. As Judge Hough said, at page 458: "* * * Negligence as an inference of fact is fairly established, and the ship is liable notwithstanding the exception, which cannot prevail over negligence."

But we know all about the stowage here. The drums were not placed next the flour, but on a solid, tight deck of a new ship, which had carried a cargo of sugar on the previous voyage safely and without wetting, though she had passed through heavy rains that washed her decks continually.

It is contended that, when acid begins to leak, the use of water dilutes the acid and aggravates its corrosive qualities. This is in some respects true, but the use of the water was to wash the acid from the deck and the other drums on which it might leak, in order to prevent it from eating away either drums or deck. The method adopted did not fully effect the desired object, but it cannot be said that it was not a good method under the circumstances. As a matter of fact, it undoubtedly proved a great saving of loss. It must be remembered that no such damage as is claimed was due to the sulphuric acid. The only flour finally condemned was 982 out of 23,000 sacks, and of the 982 sacks certainly a large proportion was injured by the neglect of the customs authorities to separate the good merchandise from the bad before placing the flour in the warehouse. As a result of this initial blunder and the delay consequent to it, there was a large amount of damage by weevils and white worms, which were working in the tropical climate upon much of the flour not injured by the acid. If the damaged flour had been promptly separated in the beginning, it may be doubted whether there would have been acid damage to more than 3 per cent. of the merchandise at worst. It would thus seem that the method adopted of washing away the acid to protect the deck was relatively successful, both in protecting the deck and caring for the cargo.

It is also argued that the master should have opened No. 2 hatch at the port of St. Thomas, when he knew the drums had begun to leak. It is not shown what he could practically have done that he did not do, if he had discovered at St. Thomas that the deck had been leaking, nor is there probability that the deck had then begun to leak, for the ship arrived there September 22d, only two days after the trouble with the first drums had occurred. It can hardly be supposed that the acid would have eaten away the rivets in two days.

It is further said that the cargo of sulphuric acid was only worth about $2,000, and that all of it should have been jettisoned as soon as a number of the drums had begun to leak. Such action it is thought would have been justified under clause 5 of the bills of lading, providing that "dangerous goods, shipped without full disclosure of their nature, * * * may be thrown overboard or destroyed at any time without compensation." But the nature of the sulphuric acid was disclosed, so that this clause would not apply.

It may be easy enough now to suggest a means of averting the damage which threatened the ship and the cargo, but the master had to deal with an emergency, and it has not been shown that he did not act with due care. The Germanic, 196 U. S. at page 595, 25 S. Ct. 317, 49 L. Ed. 610. It must always be remembered that the burden of proof is on the shipper. That burden has not been sustained. Moreover, such an act as failure to inspect the hold at St. Thomas, even if negligent, has been held by this court to be a fault in management of the ship, excusable under section 3 of the Harter Act. United States v. N. Y. & O. S. S. Co. (C. C. A.) 216 F. 61.

But the ship could in no event be liable, for the washing of the drums and deck to rid them of the acid related primarily to the management of the vessel, and not to the care and custody of the cargo. Her case, therefore, fell within the third section of the Harter Act.

While it is true that the master admitted that he knew that he was carrying an extremely dangerous cargo, which, with any leakage, might very quickly eat through the deck and around the rivets, so as to produce leakage into cargo compartments, there can be little doubt that the means adopted to prevent *331 this were means primarily to protect the ship as a whole. They were calculated to preserve its decks, and to avert what might become a serious source of leakage in the event of heavy seas. To be sure the tightness of the deck protected the cargo, just as the iron shutters carelessly left open in The Silvia, 171 U.S. 462, 19 S. Ct. 7, 43 L. Ed. 241, had they been closed, would have prevented water from coming in, in rough weather, and damaging the cargo; yet the Supreme Court said in that case that the words "navigation" and "management," in the Harter Act (46 USCA §§ 190-195; Comp. St. §§ 8029-8033, 8035), "include, at the least, the control, during the voyage, of everything with which the vessel is equipped for the purpose of protecting her and her cargo against the inroad of the seas; and if there was any neglect in not closing the iron covers of the ports, it was a fault or error in the navigation or in the management of the ship."

In The Germanic, 196 U.S. 589, 25 S. Ct. 317, 49 L. Ed. 610, where the negligent acts in failing to keep the ship trimmed while unloading the cargo were held not to be faults in management, because the primary purpose was to get the cargo ashore, Mr. Justice Holmes said that the determining factor is "the primary nature and object of the acts which cause the loss."

It was held in The Skipton Castle (D. C.) 223 F. 839, affirmed (C. C. A.) 243 F. 523, where the master failed to open a hatch in order to prevent overheating of the cargo, that the fault was in the care of the cargo and not in the management of the vessel. It was also held by this court in Andean Trading Co. v. Pacific Steam Nav. Co., 263 F. 559, where hatches were carelessly left open for ventilation of cargo, through which water entered, that the case was not within section 3 of the Harter Act, but was an "act in the care and custody of the cargo" for which the shipowner was responsible under section 1 (46 USCA § 190; Comp. St. § 8029). In both these cases the faults related primarily to the cargo.

Here the use of water to wash away the acid, while protecting the cargo, was primarily for the ship as a whole, and seems to bring the case within the doctrine of The Silvia and The Germanic, supra.

In the recent decision of the Court of Appeal in the case of Gosee Hillerd v. Canadian Government Merchant Marine, Limited, reported in Lloyd's List Law Reports of December 15, 1927, [1928] 1 K. B. ___, a majority of the court held that rain entering between deck hatches, left open through the negligence of the ship's officers while the vessel was being repaired, was a fault in the management of the vessel.

There seems to have been no ground for bringing in Cory Bros. & Co. or the American Trading Company upon any theory. The receiver of Butterworth-Judson Corporation may have been more properly impleaded, but the case against him is based purely upon the theory (contradicted by proof of the mode of manufacture) that the sulphuric acid was too much diluted, and therefore quickly corroded the drums, or that the drums must have been bad when they left the possession of the receiver, because they soon began to leak. We cannot know what might have happened to these drums while they were being loaded on shipboard, or whether some rolling of the ship might not have caused one or more to leak. There is no doubt that the leakage of any of them was a peril to the rest, and might have started many others leaking; but we cannot say that the leakage was due to defective construction, or began before September 20. As soon as it started, the plan for preventing its spread to the other drums seems to have been reasonable, even though not entirely successful.

The negligence of none of the appellees has been established, and the Milwaukee Bridge was not in any event liable, because protected by the provisions of section 3 of the Harter Act.

The decree is affirmed.