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December 21, 1966


Croake, District Judge.

The opinion of the court was delivered by: CROAKE


CROAKE, District Judge.


 This is a suit in admiralty brought by the owner of a cargo of soybean oil to recover its value following a total loss sustained when the Panamanian tanker "PERAMA" sank in the Gulf of Mexico on March 18, 1957. The case is here on retrial, having originally been heard by the late Hon. Archie O. Dawson.

 At the first trial, Judge Dawson made findings of fact which appear for the most part to be in agreement with our own. These findings were embodied in an opinion dated June 11, 1964, *fn1" wherein Judge Dawson found the defendant shipowner liable for the loss of cargo, but also found that it could limit its liability pursuant to § 183(a) of Title 46, United States Code. An interlocutory decree relating to proof and recovery of damages was entered on June 23, 1964, from which an appeal was taken to the United States Court of Appeals for the Second Circuit.

 The defendant appealed from the decree as to liability, and the plaintiffs cross-appealed with respect to the issue of limitation. *fn2" The Court of Appeals reversed as to both issues and remanded the case for a new trial. *fn3"

 The retrial, though lengthy and complicated, was well-conducted by experienced attorneys. As at the first trial, a good part of the evidence presented on the issue of liability was concerned with the defendant's effort to establish the exception of fire. In addition, a substantial body of evidence relating to unseaworthiness was presented, both in direct support of the plaintiffs' theory of unseaworthiness, and in opposition to the defendant's theory of fire. Evidence bearing on the issue of due diligence, and on the issues of knowledge and privity, was also presented and carefully considered by the court in arriving at its findings and conclusions.

 The court now delivers its opinion and decision, which opinion shall constitute its findings of fact and conclusions of law.

 As noted at the first trial, many of the essential facts were stipulated not to be in dispute by a pretrial order filed on August 9, 1963. It is stated therein that the plaintiff Federazione was the owner of a shipment of soybean oil to be shipped aboard the tank vessel "PERAMA" by the Interoceanic Commodities Corporation, charterer by virtue of a charter party between itself and the owner of the "PERAMA"; that the bill of lading was negotiated by the shipper to the plaintiff; that the tank vessel "PERAMA" was owned and operated by the defendant; that the cargo was loaded aboard the "PERAMA"; that the "PERAMA" departed from Baton Rouge with plaintiff's cargo on board on March 15, 1957; and that on March 18, 1957 the "PERAMA" sank and became a total loss with her cargo.

 On these stipulated facts, a prima facie case is established, entitling the plaintiffs to recover unless the defendant can establish a defense provided by law. *fn4" The defendant's answer to the amended complaint alleges several affirmative defenses based upon the terms of the charter party, and upon certain statutory provisions, all of which shall be taken up below. In addition to its complete defenses, defendant offers the partial defense of limitation of liability.

 The several issues calling for resolution can be stated in outline form as follows:

 1) Timeliness of suit;

 2) Liability;

 3) Limitation of liability.

 1. Timeliness of Suit.

 Neither party appealed from the determination of Judge Dawson as to timeliness of suit. His discussion of this issue took into account and resolved the question of corporate capacity to sue, as well as the validity and relation back of an amendment adding the name of the president of the plaintiff Federazione as a party plaintiff. His conclusions appear to be complete and correct. Upon careful consideration, it seems that little purpose could be served by re-formulating them. In the interest of orderly procedure, we expressly adopt and incorporate by reference that portion of the opinion of Judge Dawson dealing with these matters, *fn5" and concur in his finding that the suit was timely and properly brought.

 2. Liability.

 The gist of the plaintiffs' position is that the "PERAMA" sank because of the entry of seawater through cracks in her hull which opened as the result of unseaworthiness, and that the defendant is liable for the loss of cargo because of its failure to exercise due diligence to make the ship seaworthy.

 The defendant's position may be summarized as follows. It denies that the loss was due to unseaworthiness, and asserts that, at any rate, it exercised due diligence to make the ship seaworthy. In keeping with its denial of loss through unseaworthiness, the defendant urges that the loss was due to one of the statutorily excepted provisions and claims, specifically, that the loss was the result of fire, caused neither by its actual ...

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