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Kinsman Transit Co., 388 F.2d 821 (2d Cir. 1964)

Kinsman Transit Co., 388 F.2d 821 (2d Cir. 1964)

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Published by George Conk
Classic opinion of Judge Kaufman reviewing and applying concept of proximate cause in a chain reaction collision of cargo ships and a bridge on the Niagara River.
Classic opinion of Judge Kaufman reviewing and applying concept of proximate cause in a chain reaction collision of cargo ships and a bridge on the Niagara River.

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Categories:Types, Business/Law
Published by: George Conk on Oct 17, 2013
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Page 1388 F.2d 821, *; 1968 U.S. App. LEXIS 8356, **
LEXSEE 388 F 2D 821
Petitions of the KINSMAN TRANSIT COMPANY, as Owner andOperator of the STEAMER MacGILVRAY SHIRAS, and of the MidlandSteamship Lines, Inc., as Owner and Operator of the STEAMER MICHAEL K. TEWKSBURY, their engines, etc., for Exoneration from orLimitation of Liability, and Consolidated Cases. CARGILL,INCORPORATED and Cargo Carriers, Inc., Claimants-Appellants, v.CITY OF BUFFALO, Respondent-Appellee, Continental GrainCompany, Respondent-AppelleeNo. 132, Docket No. 30857UNITED STATES COURT OF APPEALS FOR THE SECONDCIRCUIT
388 F.2d 821
1968 U.S. App. LEXIS 8356 
December 11, 1967, ArguedJanuary 18, 1968, Decided
Page 2388 F.2d 821, *; 1968 U.S. App. LEXIS 8356, **
[**1] Affirmed.
Kaufman, Anderson andFeinberg, Circuit Judges.
[*822] IRVING R. KAUFMAN,Circuit Judge:The difficult question presented bythis appeal is whether certain expensesincurred by claimant-appellants Cargill,Inc. (Cargill) and Cargo Carriers, Inc.(Cargo Carriers), as a result of an unusualconcatenation of events on the BuffaloRiver during the night of January 21,1959, are recoverable as a matter of law.The misadventures leading to thecatastrophe on the river that fatefulevening were set forth when this litigationwas previously before this court,
338 F.2d 708 (1964)
. For our purposes it issufficient to state that as a result of thenegligence of the Kinsman TransitCompany and the Continental GrainCompany the S.S. MacGilvray Shiras broke loose from her moorings andcareened stern first down the narrow, S-shaped river channel. She struck the S.S.Michael K. Tewksbury, which in turn broke loose from her moorings and drifteddownstream -- followed by the Shiras --until she crashed into the MichiganAvenue Bridge.
The bridge collapsed andits wreckage, together with the Tewksburyand the Shiras, formed a dam [**2] whichcaused extensive flooding and an ice jamreaching almost 3 miles upstream. As aresult of this disaster, transportation on theriver was disrupted until approximatelyMarch 13, 1959 -- a period of about 2months. Subsequent to our previous[*823] adjudication of the negligenceissues, Judge Burke appointed aCommissioner to determine the damagesof the various claimants.1 The finding of negligence by theCity of Buffalo in failing to raisethe bridge was upheld by this court.
338 F.2d at 717-718
.At the time of the accident, Cargill hadsome 336,000 bushels of wheat storedaboard the S.S. Donald B. Gillies berthedin the Buffalo harbor below the MichiganAvenue Bridge. (It is apparently not anuncommon practice for companies to"winter storage" wheat in this manner.)Cargill, it appears, was under contract todeliver 124,000 bushels of the Gillies'wheat during the period from Januarythrough March 1959. Because of theaccident the vessel could not be moved toCargill's grain elevators [**3] locatedabove the collapsed bridge so that it could be unloaded. In order to comply with itscontractual obligations, Cargill wasrequired to secure replacement wheat inthe Midwest.
The Commissioner allowedCargill $30,231.38 for its extratransportation costs and $8,232 for increased "storage costs."
 2 Respondent Continental GrainCompany contends that Cargillcould have availed itself of grainelevators below the MichiganAvenue Bridge to unload theGillies. Because of our dispositionof the case, we need not deal withthis claim.3 The wheat abroad the Gillies had been financed and the "storage
Page 3388 F.2d 821, *; 1968 U.S. App. LEXIS 8356, **
costs" represented the accumulatedinterest for the period during whichthe wheat could not be utilized. Inaddition, in an award not contestedon this appeal, Cargill recovered$9,790 for flood damage to itsupriver installations.Cargo Carriers' claim is somewhatdifferent. When the calamity occurred itwas in the process of unloading a cargo of corn from the S.S. Merton E. Farr atelevators located [**4] above theMichigan Avenue Bridge. Apparently theFarr was struck by one of the two free-drifting ships. Its cargo was undamaged but it broke loose from the dock at whichit was moored. The by-product of this wasthat an ice jam formed between the Farr and the dock and normal unloading became impossible; the city fireboat andthe harbor towing tugs which ordinarilywould have broken up the ice jam were below the bridge wreckage and thus couldnot be of any assistance. The consequenceof all this was that Cargo Carriers, whichwas under contract to transfer 10,322 bushels of the Farr's corn, was required tocontinue the ship's unloading with the aidof specially rented equipment. TheCommissioner awarded it $1,590.40 for these incurred expenses.Judge Burke refused to confirm either the Gillies or the Farr awards made by theCommissioner. He reasoned that theevidence established that the damages toCargill and Cargo Carriers were caused bynegligent interference with theicontractual relations. In the absence of  proof that the interference was intentionalor with knowledge of the existence of thecontracts, he concluded recovery couldnot be grounded in tort.
 Robins Dry Dock and Repair Co. v. Flint, 275 U.S. 303, 48S. Ct. 134, 72 L. Ed. 290 (1927)
. [**5]We too deny recovery to the claimants, but on other grounds.We do not encounter difficulty withJudge Burke's analysis because it lackssome support in the case law; instead, wehesitate to accept the "negligentinterference with contract" doctrine in theabsence of satisfactory reasons for differentiating contractual rights fromother interests which the law protects. Theargument, frequently heard, that to allowrecovery in such instances would imposea penalty far out of proportion to thedefendant's fault or open the field tocollusive claims and increased litigation,see Prosser, The Law of Torts, 964 (3d ed.1964), which are the spectres commonlyraised whenever the law extends its protection. Here, as elsewhere, the answer must be that courts have some expertise in performing their almost daily task of distinguishing the honest from thecollusive or fraudulent claim. And, "if theresult is out of all proportion to thedefendant's fault, it can be no less out of  proportion to the plaintiff's entireinnocence."
 Id. at 296 
. Moreover, severalcases often cited as illustrations of theapplication of the "negligent interferencewith contract" doctrine have been [*824]convincingly [**6] explained in terms of other, more common tort principles. See 1Harper and James, The Law of Torts, 505-10 (1956). Indeed, Professors Harper andJames suggest that the application of thedoctrine is wholly artificial in mostinstances. Id. at 501. We therefore prefer to leave the rock-strewn path of "negligentinterference with contract" for morefamiliar tort terrain. Cargill and CargoCarriers argue broadly that they suffereddamage as a result of defendants'

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