Battery Steamship Corp. v. Refineria Panama, S. A. And United States of America

513 F.2d 735, 1975 U.S. App. LEXIS 15270
CourtCourt of Appeals for the Second Circuit
DecidedApril 7, 1975
Docket342, Docket 73-2710
StatusPublished
Cited by61 cases

This text of 513 F.2d 735 (Battery Steamship Corp. v. Refineria Panama, S. A. And United States of America) is published on Counsel Stack Legal Research, covering Court of Appeals for the Second Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Battery Steamship Corp. v. Refineria Panama, S. A. And United States of America, 513 F.2d 735, 1975 U.S. App. LEXIS 15270 (2d Cir. 1975).

Opinion

ROBERT P. ANDERSON, Circuit Judge:

The SS Elwell, owned by the appellant, Battery Steamship Corp., and under time charter to the appellee, Military Sea Transport Service (MSTS), an agency of the United States, was damaged on June 25, 1967, when an oil carrier owned and operated by Refinería Panama, S. A. (Refinería), struck the Elwell while attempting to refuel her in Colon Bay, Republic of Panama. Within a day of the accident, Battery Steamship notified MSTS, which had ordered and paid for the refueling operation, that the collision had occurred and that MSTS was liable under the terms of the charter party for the resulting damage.

The time charter was amended on three separate occasions, following the above described events. By the terms of the third amendment, dated August 7, 1968, Battery Steamship agreed, inter alia, 1 to “waive all damage claims except those based on damage reports submitted with [its] letter dated 5 August 1968.” None of the damage reports, or the letter itself, included or mentioned the damage resulting from the collision in Colon Bay.

After the charter had expired, however, Battery Steamship sought reimbursement for the damage which arose out of the June 25, 1967 incident, but MSTS refused to pay the claim. Thereafter Battery Steamship brought this action in admiralty in June 1969 against the United States to recover $47,595. In August 1971 Battery Steamship amended its complaint to include Refinería as a party defendant, but the suit against Re-finería was dismissed as time barred.

The Government filed a motion for summary judgment, contending that Battery Steamship had contractually waived its claim, and that MSTS was not liable, in any event, under the terms of the charter party for damages caused by the negligence of independent contractors during refueling operations.

Battery Steamship argued that summary judgment was inappropriate because there was a genuine issue of fact concerning the meaning of the waiver and the intent of the parties. Thereafter affidavits were submitted by both sides which showed that, during the negotiation of the third charter amendment, it had been assumed that the release would apply only to the claims for incidental damages unreported by the Master as of August 5, 1968. 2 Battery *738 Steamship also filed a cross-motion for partial summary judgment asking that the affirmative defense, based upon the release, be stricken on the ground that there was insufficient consideration to support a waiver of the claims arising out of the Colon Bay incident.

The district court, however, held that the original charter and its various amendments constituted an integrated agreement which, by its clear terms, released the United States from potential liability for damages not reported in the letter of August 5, 1968. It also concluded that the affidavits did not disclose a material issue of fact in spite of the fact that portions of the evidentiary material contradicted the unambiguous meaning of the writing, because such portions were barred by the parol evidence rule. It therefore entered summary judgment in favor of the Government. The cross-motion for partial summary judgment was denied on the ground that the release, when viewed in the context of the other provisions of the amendment, was supported by a consideration. No ruling was made on the alternative defense that MSTS was not liable in any event under the terms of the charter party for the negligence of independent contractors.

Summary judgment may properly be granted when there is no genuine issue as to any material fact and the moving party is entitled to a judgment as a matter of law. Rule 56(c) F.R.Civ.P.; Poller v. Columbia Broadcasting System, Inc., 368 U.S. 464, 467, 82 S.Ct. 486, 7 L.Ed.2d 458 (1962); Schwartz v. Associated Musicians of Greater New York, Local 802, 340 F.2d 228, 232 (2d Cir. 1964). Infer-enees to be drawn from the underlying facts set forth in the supporting evidentiary material “must be viewed in the light most favorable to the party opposing the motion.” United States v. Diebold, Inc., 369 U.S. 654, 655, 82 S.Ct. 993, 994, 8 L.Ed.2d 176 (1962). In the present case, because there have been submitted by both parties affidavits which show that there is, in fact, a dispute as to the actual meaning of the release, the central issue on appeal is whether the parol evidence rule barred this testimony from consideration by the district court.

The parol evidence rule is generally defined as follows:

“When two parties have made a contract and have expressed it in a writing to which they have both assented as the complete and accurate integration of that contract, evidence, whether parol or otherwise, of antecedent understandings and negotiations will not be admitted for the purpose of varying or contradicting the writing.” (Footnote omitted.) 3 A. Corbin, Contracts, § 573, at 357 (1960).

Although the federal and all state jurisdictions apparently accept this classic statement of the parol evidence rule, they do not all agree upon its interpretation and application. 3 A preliminary question, therefore, is what law applies.

In the present case it is abundantly clear that the principles of maritime contract law govern. The contract, which is the subject of the litigation, is a time charter and its amendments relate to a particular vessel. Its terms “per *739 tain directly to and [are] necessary for commerce or navigation upon navigable waters,” 7A J. Moore, Federal Practice If.230[2], at 2761 (1972). From no point of view can the application of the- parol evidence rule to a maritime contract be regarded as “peculiarly a matter of state and local concern,” Kossiek v. United Fruit Co., 365 U.S. 731, 741, 81 S.Ct. 886, 893, 6 L.Ed.2d 56 (1961). See also Hellenic Lines Limited v. Gulf Oil Corporation, 340 F.2d 398, 402 (2 Cir. 1965). It has long been recognized that a special need exists for uniformity in the rules governing the application of such matters as the Statute of Frauds in maritime contracts, Union Fish Co. v. Erickson, 248 U.S. 308, 39 S.Ct. 112, 63 L.Ed. 261 (1919), and like considerations apply to the parol evidence rule.

“Where states have sought to enter the field [of admiralty] by statute their efforts usually have been thwarted as infringements of a field reserved to Congress and the federal courts by the Constitution and as interferences with the uniformity requirements of the maritime law. . . . And in the field of maritime contracts generally, the cases are clear that in most situations federal, and not state, principles apply to determine the respective rights and duties of the parties.” A/S J. Ludwig Mowinckels R. v.

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Bluebook (online)
513 F.2d 735, 1975 U.S. App. LEXIS 15270, Counsel Stack Legal Research, https://law.counselstack.com/opinion/battery-steamship-corp-v-refineria-panama-s-a-and-united-states-of-ca2-1975.