Goodpasture, Inc. v. M/V Pollux

688 F.2d 1003, 1983 A.M.C. 3000
CourtCourt of Appeals for the Fifth Circuit
DecidedOctober 12, 1982
DocketNo. 80-2216
StatusPublished
Cited by25 cases

This text of 688 F.2d 1003 (Goodpasture, Inc. v. M/V Pollux) is published on Counsel Stack Legal Research, covering Court of Appeals for the Fifth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Goodpasture, Inc. v. M/V Pollux, 688 F.2d 1003, 1983 A.M.C. 3000 (5th Cir. 1982).

Opinion

POLITZ, Circuit Judge:

We again address the claims arising out of an aborted sale of approximately 20,000 metric tons of number two hard red winter wheat. The factual setting of this involved dispute is essentially detailed in our prior opinion, Goodpasture, Inc. v. M/V POLLUX, 602 F.2d 84 (5th Cir. 1979). On remand, additional facts were developed. Subject to one minor modification, we perceive no clearly erroneous factual finding and find no error of law in the trial court’s [1005]*1005disposition. Accordingly, we modify and affirm.

Goodpasture, Inc., a Texas corporation engaged in wheat transactions, contracted with Empac Grain Corporation, Inc., a New York corporation, for the sale of the noted quantity of wheat. Empac was to acquire the wheat for Idema, a Colombian governmental entity. The agreement ultimately negotiated provided for payment to Good-pasture under an assignment of proceeds of an irrevocable letter of credit established for Empac by Idema. Goodpasture was designated as Empac’s agent to gather the documents necessary for payment under the letter of credit.1

Empac entered into a time charter party with Negocios del Mar, S.A., a Peruvian shipping concern, for the M/V POLLUX, which was to transport the grain from Houston, Texas to Buenaventura, Colombia. After certain delays and difficulties which are not of immediate relevancy, the vessel arrived and Goodpasture loaded the grain. The ship’s master, acting under revised instructions from the owner, insisted on payment consistent with the charter party and refused to sign freight prepaid bills of lading. Without that documentation, Good-pasture could not effect payment under the letter of credit. Goodpasture had loaded its wheat aboard the POLLUX, the vessel was prepared to depart, but Goodpasture, obligated to pay its vendor for the wheat, could not secure payment. Goodpasture filed an in rem suit resulting in the arrest of the vessel, later amended to seek personal judgment against Empac and Negocios.

Shortly after the seizure, Goodpasture moved for discharge of the grain. Several weeks later, after due hearing and the posting of security as demanded by Negocios, the grain was removed from the POLLUX. The district court initially concluded that the refusal by Negocios to sign freight prepaid bills of lading did not constitute conversion of the wheat and that Goodpasture had no in rem rights against the vessel. The district court ordered the seizure released and Goodpasture’s suit dismissed. On appeal, we reversed and remanded. 602 F.2d 84. The district court had found that title to the grain had not passed from Good-pasture to Empac. Consistent therewith, we held that the POLLUX had no claim against Goodpasture to support the maritime lien it had asserted against the cargo composed exclusively of Goodpasture’s wheat. We further held that Negocios’ seizure of Goodpasture’s wheat as security for its claim against Empac was a maritime tort which gave rise to Goodpasture’s in rem claim against the POLLUX.

On remand, the district court, because of Negocios’ contention that further litigation as to the title to the wheat was not foreclosed by our decision, held evidentiary hearings at which Negocios was permitted to offer evidence relative to the title issue. Thereafter the district judge, in a scholarly, detailed and comprehensive opinion, found and concluded that, assuming the law of the case doctrine did not preclude further consideration of the title issue, the additional evidence supported and confirmed the conclusion that the POLLUX had exercised wrongful dominion over Goodpasture’s wheat. Damages were awarded to Good-pasture, and counterclaims against Good-pasture and the cargo of wheat were rejected.

Title to the Wheat

As a general rule, “a decision of a legal issue or issues by an appellate court establishes the ‘law of the case’ and must be followed in all subsequent proceedings in the same case in the trial court or on a later appeal in the appellate court . . . . ” White v. Murtha, 377 F.2d 428, 431-432 (5th Cir. 1967). An exception to this rule arises when “ ‘[1] the evidence on a subsequent trial was substantially different, [2] controlling authority has since made a contrary decision of the law applicable to such issues, or [3] the decision was clearly erroneous and [1006]*1006would work manifest injustice.’ ” Morrow v. Dillard, 580 F.2d 1284, 1290 (5th Cir. 1978) (quoting from White v. Murtha, 377 F.2d at 432).

Negocios’ primary argument is that our prior opinion erroneously interpreted the provisions of the Texas Uniform Commercial Code 2 with respect to passage of title. An examination of the Texas U.C.C. quickly reflects that parties may control passage of title as between themselves by contractual agreement.3 Tex. Bus. & Com. Code Ann. tit. 1, § 2.401(a) (Vernon); J. White & R. Summers, Uniform Commercial Code at 139 (1980). See Heinrich v. Wharton County Livestock, Inc., 557 S.W.2d 830 (Tex. Civ. App. 1977). Moreover, as the district court noted, a “usage of trade,” defined as “any practice or method of dealing having such regularity of observance in a place ... or trade as to justify an expectation that it will be observed with respect to the transaction in question,” Tex. Bus. & Com. Code Ann. § 1.205(b) (Vernon), should be read as giving “particular meaning to and supplementing] or qualifying] terms of an agreement.” Section 1.205(c).4 We affirmed the district court’s finding that the custom and usage in the grain trade called for title to pass upon payment and that Empac and Goodpasture had agreed to this arrangement. Our earlier opinion does not fall within the clearly erroneous exception. Concluding that the other exceptions are inapplicable, we are constrained to conform to the law of the case rubric and decline further review of this claim.5

Measure of Damages

The district court awarded Good-pasture damages in the amount of $224,-198.40, representing the difference in the amount Goodpasture was to receive for its services under the Empac contract and the amount ultimately received pursuant to a subsequent sale to Dreyfus Corporation. In reaching this conclusion, the court referred to the basic principles that damages in a conversion action should compensate for the loss actually sustained as a result of the tortfeasor’s wrong, Standard Oil Co. v. Southern Pacific Co., 268 U.S. 146, 45 S.Ct. 465, 69 L.Ed. 890 (1924), and a plaintiff may generally recover the reasonable market value of the goods converted, as of the time and place of conversion, Harrington v. Texaco, Inc., 339 F.2d 814 (5th Cir.), cert. denied, 381 U.S. 915, 85 S.Ct. 1538, 14 L.Ed.2d 435 (1964); Restatement (Second) of Torts § 222A (1965).

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688 F.2d 1003, 1983 A.M.C. 3000, Counsel Stack Legal Research, https://law.counselstack.com/opinion/goodpasture-inc-v-mv-pollux-ca5-1982.