Dunavant Enterprises, Inc. v. Strachan Shipping Company

730 F.2d 665, 1984 U.S. App. LEXIS 23291
CourtCourt of Appeals for the Eleventh Circuit
DecidedApril 23, 1984
Docket83-7023
StatusPublished
Cited by7 cases

This text of 730 F.2d 665 (Dunavant Enterprises, Inc. v. Strachan Shipping Company) is published on Counsel Stack Legal Research, covering Court of Appeals for the Eleventh Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Dunavant Enterprises, Inc. v. Strachan Shipping Company, 730 F.2d 665, 1984 U.S. App. LEXIS 23291 (11th Cir. 1984).

Opinion

PER CURIAM:

This lawsuit arises out of the loss sustained by Dunavant Enterprises, Inc. (“Dunavant”) when a fire damaged 151 bales of cotton that it had stored in a dockside warehouse at the Port of Mobile. Dunavant sued Strachan Shipping Company (“Strachan”), the shipping agent and stevedore for the carrier that was to transport the cotton cargo. After a trial to the judge, the district court entered judgment in favor of Strachan. On appeal, the case presents three issues for our resolution: (1) whether the district court erred in determining that it did not have admiralty jurisdiction over Dunavant’s claim against Strachan, (2) whether the district court’s finding that Strachan was not the bailee of Dunavant’s cotton was clearly erroneous, and (3) whether the district court’s finding that Strachan was not negligent with respect to its handling of the cotton cargo was clearly erroneous. Because admiralty jurisdiction, if it existed at all in this case, would be based on the existence of a maritime bailment, and because we conclude that the district court’s finding that no bailment existed between Dunavant and Strachan was not clearly erroneous, we affirm the district court’s determination that this case does not fall within the court’s admiralty jurisdiction. Additionally, we conclude that the district court’s finding that Strachan was not negligent *667 was not clearly erroneous and thus affirm its decision on the negligence issue as well.

In 1979, Dunavant entered into a series of contracts with the China National Textiles Import & Export Corporation pursuant to which Dunavant agreed to sell approximately .one million bales of cotton to the People’s Republic of China. The China Ocean Shipping Company (“China Ocean”) served as the ocean carrier for Dunavant's shipments of cotton to the People’s Republic. China Ocean hired Strachan to act as its shipping agent and stevedore at the various ports of loading that would be used in transferring the cargo. Strachan’s duties as shipping agent included tallying and inspecting the cotton for visible damage when it arrived at the port for shipment. Its duties as stevedore involved loading the cotton onto the ocean-going vessels when it was ready for shipment. No contractual relationship existed between Dunavant and Strachan.

The cotton cargo shipped through Mobile, including the cargo involved in this litigation, was stored in a warehouse owned and operated by the Alabama State Docks Department (“State Docks”). Unlike the practice in other ports, in Mobile the State Docks does not lease its warehouses. It gives carriers, ship agents, stevedores and shippers the privilege of using its berths, warehouses and other facilities. When cargo arrives for temporary storage, State Docks unloads it, stacks it if appropriate in one of its warehouses and issues a warehouse receipt. 1 If the cargo is damaged, the State Docks recoups the cargo for the account of the cargo owner. The State Docks has ultimate authority to determine where and how the cargo is to be stored, although it often will defer to the wishes of the ship agent to accommodate the carrier in loading the vessel. 2 State Docks maintains security in the warehouse and port area, charges the shipper for storage expenses 3 and claims a possessory lien on the cargo stored in its warehouses.

Trial testimony indicated that State Docks controlled access to the warehouse in which the cotton involved in this.case was stored. Although, at the time of the fire, the warehouse apparently contained only cargo for carriage by vessels for which Strachan was shipping agent, Strachan did not maintain control over the warehouse. In addition to the facts previously noted, Strachan could not, for example, keep out of the warehouse State Docks employees, crewmen of the ships or truck drivers delivering cargo. Moreover, Strachan had no authority as a stevedore to load Dunavant’s cotton cargo aboard a ship until directed to do so by Dunavant, either directly or through its agent.

On February 2, 1980, Strachan employees who were then working in another corner of the warehouse loading cotton aboard a vessel detected and reported a fire in the northeast corner of the North B(l) warehouse. 4 Within approximately ten minutes, the combined efforts of the Mobile Fire Department and the warehouse’s overhead sprinkler system brought the fire under control. State Docks employees quickly segregated the 151 bales of damaged cotton from the rest of the cotton cargo stored in the warehouse.

*668 Dunavant here challenges the conclusion of the district court that it did not have admiralty jurisdiction over Dunavant’s claim against Strachan. Dunavant argues that its delivery and Strachan’s receipt of the cotton cargo created a pre-loading bailment, which under Baker Oil Tools, Inc. v. Delta Steamship Dines, Inc., 562 F.2d 938 (5th Cir.1977), modified, 571 F.2d 978 (5th Cir.1978), 5 brings the case within the court’s admiralty jurisdiction.

Baker Oil Tools recognized that pre-loading bailments between the shipper and common carrier fall “within the ambit of maritime law.” Id. at 940. Similarly, a bailment to which Dunavant, the shipper, and Strachan, the agent of the vessel owner, were parties would fall within the court’s admiralty jurisdiction. A pre-loading bailment under the maritime law places upon the bailee “the custodial responsibilities that devolve upon a common law bailee.” Baker Oil Tools, 562 F.2d at 941. The common law thus defines the responsibilities of the maritime bailee, id., and supplies to maritime law the elements required to find a bailment relationship. See id. (affirming on the basis of maritime bailment district court’s decision based on common law bailment); T.N.T. Marine Service, Inc. v. Weaver Shipyards & Dry Docks, Inc., 702 F.2d 585, 588 (5th Cir.), cert. denied, — U.S. —, 104 S.Ct. 151, 78 L.Ed.2d 141 (1983).

Alabama recently adopted the common law definition of bailment. In Farmer v. Machine Craft, Inc., 406 So.2d 981 (Ala.Civ.App. 1981), the Court defined a bailment as

“[T]he delivery of personal property by one person to another in trust for a specific purpose, with a contract, express or implied, that the trust shall be faithfully executed, and the property returned or duly accounted for when the special purpose is accomplished, or kept until the bailor reclaims it.”

Id. at 982 (quoting 8 Am.Jur.2d Bailments § 2 (1980) (footnotes omitted)). A bailment requires the “change of possession, actual or constructive, and the bailee must háve voluntarily assumed the custody and possession of the property for another. Change of possession necessarily requires a change of actual or constructive control over the item of property.” Id. at 982-83 (citations omitted).

The district court here found that no bailment existed between Dunavant and Strachan.

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730 F.2d 665, 1984 U.S. App. LEXIS 23291, Counsel Stack Legal Research, https://law.counselstack.com/opinion/dunavant-enterprises-inc-v-strachan-shipping-company-ca11-1984.