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Hirsch Lumber Co. v. Weyerhaeuser Steamship Co.

decided.: June 1, 1956.


Author: Lumbard

Before CLARK, Chief Judge, and HINCKS and LUMBARD, Circuit Judges.

LUMBARD, Circuit Judge.

This appeal raises two questions: First, whether bills of lading under which lumber was to be carried by sea from Olympia, Washington to Port Newark, New Jersey, could lawfully provide that freight was immediately due upon delivery of the lumber to the carrier even though the lumber was not delivered to point of destination because of a strike at Port Newark. The second question is whether there was evidence to sustain the jury's finding that the carrier's delivery of the lumber to Baltimore because of the strike was a reasonable diversion under the Carriage of Goods by Sea Act, 46 U.S.C.A. ยง 1304, and the provisions of the bills of lading.

Hirsch Lumber Company was the purchaser of one bill of lading and the assignee of the purchasers of seven other bills of lading, all covering shipments from Olympia, Washington to Port Newark, New Jersey, on the Western Trader, a liberty ship under $50,000 per month time charter to the carrier, Weyerhaeuser Steamship Company. Hirsch sued for return of freight paid in the total of $33,827.32, with interest and other charges, on the ground that Weyerhaeuser had not earned the freight because it failed to deliver the lumber at Port Newark. In the alternative Hirsch sought the reasonable cost of transporting the lumber from Baltimore to Port Newark, plus handling and terminal charges, which allegedly totalled approximately $34,850.

The Western Trader arrived at New York Harbor on January 3, 1955 and completed discharging lumber not covered by Hirsch's bills of lading at Brooklyn on January 6. Her next port of discharge was to be Atlantic Terminals, Port Newark, and her final port was Independent Terminals, also at Port Newark.

Commencing January 3 a picket line had been established at Atlantic Terminals by striking lumber-handling employees who were members of Local 478 Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America, A.F.L. At this time the steamship W. L. McCormick, owned and operated by Weyerhaeuser, was berthed at Atlantic Terminals, having arrived with a cargo of lumber on January 1. When the McCormick was shifted to Bayway Terminals in Port Newark on January 4 a picket line prevented her unloading there. After the Western Trader had unloaded her Brooklyn cargo she anchored off Staten Island on January 6 and remained there until January 14. The strike continued until April 5, 1955.

Considerable evidence was introduced by Weyerhaeuser tending to show that there was good reason to conclude that the lumber could not have been discharged at Port Newark or elsewhere in the Port of New York. Various of defendant's employees testified that representatives of the union on strike had stated that they would establish a picket line at any place where any vessel with cargo consigned to Atlantic Terminals might berth. As already stated, pickets had followed Weyerhaeuser's McCormick to Bayway Terminals in Port Newark on January 4 and had thereby prevented her unloading there. Not all of the lumber covered by the bills of lading involved here was consigned to Atlantic Terminals, but there was evidence to show that the Western Trader was so loaded that the Atlantic Terminals lumber had to be discharged before any of the other lumber could be reached.

On January 6 Weyerhaeuser commenced an action against the officers of the striking union in the District Court for New Jersey. An application for an injunction against picketing any of Weyerhaeuser's vessels at Newark or in the Port of New York, heard on January 12 by order to show cause signed on January 7, was denied on the ground that the National Labor Relations Board had primary jurisdiction. Following this, on January 13, Weyerhaeuser filed a complaint with the Board.

Captain Lawrence Howard, a vicepresident and director of Weyerhaeuser, testified that he sought permission of the Port of New York Authority to berth the Western Trader at a public terminal pier in Port Newark, but that this was refused. This was corroborated by Captain Robert Schulze, general manager of the Marine Operations Division of the Port of New York Authority. Edward J. Carroll, General superintendent of the Nacirema Operating Company, who was a member of the Conference Committee of the New York Shipping Association, which represents the shipping companies in negotiating collective bargaining agreements with the International Longshoremen's Association, also testified for the defendant. He was handling the unloading of the McCormick and the Western Trader and he contacted various officials of the I.L.A. in an effort to get the ships unloaded. Each official with whom he talked advised him that the longshoremen would respect a picket line.

After the failure of all these attempts to find a means of unloading in Newark or the Port of New York Weyerhaeuser learned that labor in Baltimore would not honor pickets from Newark. Accordingly the Western Trader left New York on January 14 and steamed to Baltimore where she commenced discharging the lumber on January 15. The pickets did follow the Western Trader to Baltimore and established a picket line at the terminal there, but despite this the lumber was unloaded.

The plaintiff sought to show that part or all of the Western Trader's lumber could have been unloaded at the Independent Terminals in Port Newark or the Gowanus Terminals in Brooklyn. Thus Mr. Hall, president of the Independent Terminals testified that he was ready, willing and able to berth and unload the Western Trader. He qualified this, however, by stating that he would not have attempted to unload "hot cargo" consigned to the Atlantic Terminals. Mr. Garbutt, terminal manager of the Gowanus Terminals, testified that in his opinion the Western Trader could have been unloaded at his Terminals in Brooklyn.

The eight bills of lading all provided that the lumber was to be delivered at Port Newark, New Jersey and they all contained the word "Collect" next to the amount of the freight indicating that the freight was to be paid on delivery. They provided in Clause 11:

".Freight, whether prepaid or collect, becomes wholly due and belongs absolutely to Carrier as soon as the Goods are received by Carrier, and shall be deemed earned, and if prepaid shall not be returnable, and if collect shall be payable, ship and/or cargo lost or not lost."

They provided further in Clause 6 that in case of any event which in the judgment of the carrier or master is likely ...

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