Pacific Vegetable Oil Corp. v. S/S SHALOM

257 F. Supp. 944, 10 Fed. R. Serv. 2d 1110, 1966 U.S. Dist. LEXIS 8308
District Court, S.D. New York·Decided July 20, 1966·No. 64 Ad. 1332, 64 Ad. 1347, 65 Ad. 61, 65 Ad. 578, 65 Ad. 584, 65 Ad. 915·Published·Cited by 11 cases

Opinion

OPINION

EDELSTEIN, District Judge.

In an opinion reported at 249 F.Supp. 503 (S.D.N.Y.1966) this court ruled that the Zim Israel Navigation Co., Ltd. could not discontinue without prejudice, as of right, merely upon payment of statutory costs, but rather that Zim could discontinue without prejudice only upon the terms and conditions imposed by this court. That opinion, however, expressly reserved decision on the issue of what terms and conditions ought to be imposed. Thereafter extensive hearings were held and oral argument presented. The court is, therefore, now in a position to decide what terms and conditions should be imposed upon Zim.

In its prior decision, handed down on January 12, 1966, this court read into the old Admiralty Rules the equitable principles incorporated in Fed.R.Civ.P. 41(a) (2). Subsequent to that decision the Supreme Court merged the Civil and Admiralty Rules, effective July 1, 1966, by making the Federal Rules of Civil Procedure applicable in admiralty cases (with certain exceptions not here relevant). Paragraph 2 of the Supreme Court’s promulgating order states that the new rules are effective July 1, 1966, and applicable “in all further proceedings in actions then pending, except to the extent that in the opinion of the court their application in a particular action then pending would not be feasible or would work injustice * * U. S. Code Cong. & Ad. News, 89th Cong. 2d Sess. 903, 941 (April 5, 1966, advance sheet). 1 In the instant case the application of the recent merger of the civil and admiralty rules is feasible and would work no injustice. Pursuant both to this court’s decision of January 12, 1966, and to Paragraph 2 of the Supreme Court’s order promulgating the amended Rules of Procedure, the equitable principles of Fed.R.Civ.P. 41(a) (2) are applicable to this motion.

The basic facts are set forth in the January 12, 1966, opinion and Footnote 1 thereto. Additional information, however, has become available during the course of these hearings.

The first suit arising out of the November 26, 1964, collision was actually a personal injury claim filed in this court on December 1, 1964, against both A/S Ocean and Zim Israel. After the subsequent filing of the Pacific Vegetable and Bunge Corporation cargo libels against Zim, but prior to Zim’s impleaders here, A/S Ocean arrested the Zim Vessel NA-HARIYA when it entered the port of Gothenburg, Sweden. The NAHARIYA was not involved in the November 26, 1964, collision and the Swedish forum’s only contact with the collision was the *946 arrest and subsequent release bond posted for the NAHARIYA.

Many of the problems in this case arise because there are two main suits in two jurisdictions between the same parties to the same collision. A/S Ocean urged, at least initially, that Zim should not have impleaded it in the cargo suits after A/S Ocean had already sued Zim in Sweden. Rather, Zim should have, it was urged, promptly settled the cargo claims (which it was ultimately required to do anyway), and counterclaimed or countersued in Sweden. Thus, it was alleged, Zim was to blame for the problems arising out of dual jurisdiction. Zim urges, on the other hand, that the cargo suits and a personal injury suit had already been filed here, prior to A/S Ocean’s suit in Sweden. Moreover, because the collision occurred just off the New Jersey coast (although in international waters) most of the investigation had to be done here and many of the witnesses and exhibits, including the remains of the STOLT DAGALI, were located in or near New York. Zim urges that A/S Ocean had no business commencing suit in Sweden since that forum’s only contact with the parties or the collision was that a different Zim vessel, the NAHARIYA, happened to put into a Swedish port. Thus, Zim urges, A/S Ocean was to blame for the problems arising out of dual jurisdiction.

By arresting the NAHARIYA in Sweden, A/S Ocean obtained at least two tactical advantages. In order to obtain the release of the NAHARIYA Zim was required to post substantial security in Gothenburg, Sweden, against which A/S Ocean would be able to claim. Second, the arrest of the NAHARIYA gave A/S Ocean a forum in which it could be certain that the applicable law would be the Brussels Collision Convention. Thus, assuming that both vessels were to blame for the collision but that the SHALOM was more at fault than the STOLT DA-GALI, A/S Ocean would fare better under the Brussels Collision Convention rule of proportional fault than it would under the American rule of equal division of damages. The cargo interests, however, had an important interest in suing Zim in the United States. Under United States law there is, between colliding ships, joint and several liability to cargo, the innocent third party. Apparently as a result of its carriage agreements with the STOLT DAGALI interests, cargo could not collect for negligent ship-handling but could only collect from the STOLT DAGALI if the STOLT DA-GALI was unseaworthy. Cargo would, therefore, fare better in the United States, since under joint and several liability cargo might theoretically collect its entire loss from Zim here. In Sweden Zim’s liability to cargo, under the Brussels Collision Convention, would be limited to Zim’s proportional share of the fault. The cargo suits were thus commenced in this jurisdiction. Zim, finally, had been able to obtain security when it arrested the foresection of the STOLT DAGALI in this jurisdiction and also had the advantage that under American law any payments it made to cargo in settlement would be includable in its claim for collision damages against A/S Ocean. In Sweden, on the other hand, Zim would, it appears, be precluded from including payment to cargo in its collision claims. Moreover, if the SHALOM were more than fifty percent to blame for the collision, (although not solely at fault), Zim would fare better under the American equal division of damages rule, than it would under the Brussels Collision Convention rule of proportional fault, which is applied in Sweden.

Free access — add to your briefcase to read the full text and ask questions with AI

Pacific Vegetable Oil Corp. v. S/S SHALOM, 257 F. Supp. 944, 10 Fed. R. Serv. 2d 1110, 1966 U.S. Dist. LEXIS 8308 (S.D.N.Y. 1966).

257 F. Supp. 944 (Pacific Vegetable Oil Corp. v. S/S SHALOM) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

Related

Degussa Admixtures, Inc. v. Burnett
471 F. Supp. 2d 848 (W.D. Michigan, 2007)
Colombrito v. Kelly
764 F.2d 122 (Second Circuit, 1985)
Fernandez v. Southside Hospital
593 F. Supp. 840 (E.D. New York, 1984)
Gilbreth International Corp. v. Lionel Leisure, Inc.
587 F. Supp. 605 (E.D. Pennsylvania, 1983)
Bishop v. West American Insurance
95 F.R.D. 494 (N.D. Georgia, 1982)
Alkmeon Naviera, S.A. v. M/V MARINA L
633 F.2d 789 (Ninth Circuit, 1980)
Alkmeon Naviera v. Marina
633 F.2d 789 (Ninth Circuit, 1980)
Dome Laboratories v. Farrell Ex Rel. Farrell
599 P.2d 152 (Alaska Supreme Court, 1979)
Fitzgerald v. Texaco, Inc.
521 F.2d 448 (Second Circuit, 1975)