Opinion ID: 339154
Heading Depth: 1
Heading Rank: 3

Heading: Shipper's Liability.

Text: 18 The district court submitted three interrogatories to the jury concerning the potential liability of the Shipper, which also manufactured the pallets. The jury concluded that the pre-palletized unit broke apart due to the negligence of the Shipper, that the pallet contained a latent or hidden defect, and that the Shipper's actions were a proximate cause of the longshoreman's injuries. On the basis of these findings, the district court held that the Shipowner and Time Charterer were entitled to full indemnification from the Shipper. 13 Although the claim of indemnity against the Shipper was based on theories of breach of warranty, strict liability in tort, and negligence, the parties agree that the district court submitted the indemnity issue to the jury only on a negligence theory. 14 On appeal the Shipper raises five claims of error: (1) that the trial court erred in permitting an unqualified witness to testify as an expert; (2) that the trial court improperly admitted the surveys of independent contractors into evidence as business records; (3) that there was no evidence to support a finding of a latent defect; (4) that there was no evidence that it was negligent; and (5) that the verdict for the plaintiff was excessive. 15 We shall first consider appellant's challenges to the admission of certain evidence and then proceed to the sufficiency questions. 19 The Shipper argues that the district court abused its discretion in permitting Daniel Devaney to testify as an expert witness for the Shipowner because he was unqualified to testify about the pre-palletized units and because his testimony lacked any probative value. We disagree. 20 Rule 702 of the Federal Rules of Evidence permits a witness qualified by knowledge, skill, experience, training, or education to testify as an expert if his specialized knowledge would assist the trier of fact. The broad discretion of the trial court to determine the qualifications of witnesses will not be disturbed unless its ruling was manifestly erroneous. Salem v. United States Lines Co., 370 U.S. 31, 35, 82 S.Ct. 1119, 8 L.Ed.2d 313 (1962). The witness Devaney had worked as a longshoreman for three years, had operated his own marine carpentry business for twenty-four years and was currently serving as a consultant in marine carpentry for a stevedoring company; he testified that he had built hundreds of thousands of stevedore's pallets. The court properly admitted his testimony about the differences between stevedore's pallets and the pre-palletized units used by fruit shippers; the fact that he had not examined the particular pallets used by the Shipper here does not require exclusion of his testimony since he clearly stated that he was familiar with this type of pre-palletized unit. See King v. Deutsche Dampfs-Ges, 523 F.2d 1042, 1045 n.2 (2d Cir. 1975) (witness who worked with stowed cargo for 28 years qualified as expert on stowage); Marchese v. Moore-McCormack Lines, Inc., 525 F.2d 831 (2d Cir. 1975) (marine carpenter with 24 years experience qualified to testify on proper stowage). Devaney also gave his opinion, in answer to a hypothetical question, that the possible causes of the disintegration of the pallet were excessive handling in transit and faulty materials in construction; he did not purport to know the actual cause of the accident, since the particular pallet involved was not available for inspection. The evidence showing the circumstances of the accident and the design of the pallet was sufficient to permit an expert to express an opinion as to the cause of the accident, even if that opinion is not conclusive. His lack of inspection of the particular pallet involved affects the weight accorded his testimony rather than its admissibility. Nanda v. Ford Motor Co., 509 F.2d 213, 221 (7th Cir. 1974). The Shipper also objects to the admission into evidence of the marine surveyor's reports at six loading ports and New York about the condition of the ship's holds to receive cargo, the cargo itself, and the stowage of the cargo. Peter Lantelme, cargo claims manager of the Time Charterer who had worked in the claims department for thirty years, testified that such surveys were ordered, received and recorded in the regular and ordinary course of business. As a part of the customary business practices of the Time Charterer, these surveys were properly admitted as records of a regularly conducted activity. 16 See Fed.Rules of Evidence, Rule 803(6). 21 The Shipper contends that the evidence is insufficient to support the jury's findings of a latent defect in the pallet or that the Shipper was negligent in manufacturing it. While the evidence in this case is less than overwhelming, we conclude that it is sufficient to support the jury's determinations. 22 As to the allegedly defective pallet, the Shipper claims that the record is barren of evidence that any defect existed, obvious or latent. In cases such as this, where the injury-causing instrument is not available for inspection at a trial occurring seven years after the accident, the courts have allowed circumstantial proof to raise permissible inferences of defective manufacture. Lindsay v. McDonnell Douglas Aircraft Corporation, 460 F.2d 631 (8th Cir. 1972) (proof of specific defect in construction or design not required in strict liability case); Nicklaus v. Hughes Tool Company, 417 F.2d 983 (8th Cir. 1969) (circumstantial evidence sufficient to support findings that manufacturer was not negligent); Franks v. National Dairy Products Corporation, 414 F.2d 682 (5th Cir. 1969) (defect can be inferred from unexplained occurrences in products liability case); North American Aviation v. Hughes, 247 F.2d 517 (9th Cir. 1957), cert. denied, 355 U.S. 914, 78 S.Ct. 341, 2 L.Ed.2d 273 (1958) (evidence supports theory of defective manufacture in negligence suit although cause of accident unclear). The trier of fact, of course, is not required to draw these inferences but can choose to accept or reject them, depending on its evaluation of the weight to be accorded to competing and perhaps conflicting evidence. 23 The appellee's expert, Mr. Devaney, testified that in his opinion, the probable cause of the accident might be excessive handling of the fragile disposable units or faulty materials used in manufacture. Much of appellee's evidence tended to show the lack of any apparent defect or any change in the pallets due to mishandling after leaving the Shipper's hands: clean mate's receipt, loading certificate and clean bill of lading to show that the cargo was received without apparent defect or damage and marine surveyor's reports made in regular course of business at each port to demonstrate no damage or apparent change during the voyage. One reasonable and permissible inference to draw from these occurrences was that the pallet contained a latent defect from the manufacturing process that caused it to disintegrate when it was hoisted from the hold. 24 To support a claim for negligent manufacture, a preponderance of the evidence must show that the product was defectively designed or manufactured, that the defect was a proximate cause of the injury, that the defect existed when the manufacturer parted with possession and that the manufacturer failed to make any reasonable inspection or test to discover the defect. The manufacturer thus has the affirmative duty to make such tests and inspections, during and after the process of manufacture, which are commensurate with the dangers involved in the intended use of the product. Nicklaus v. Hughes Tool Company, supra, 417 F.2d at 986. Pre-palletizing the cargo facilitates loading and unloading by obviating the need to shift and secure the goods to and from stevedore's pallets in transport; however, it also removes the added safeguards of lashings and ties and the extra sturdiness of the reusable pallets themselves. We have discussed above the sufficiency of the circumstantial evidence to show the defect in the pallet which broke and its existence when the manufacturer parted with possession. That a defect was a proximate cause of the longshoreman's injury cannot seriously be disputed. The remaining question is whether the Shipper failed to make any reasonable inspection or test to discover the defect. The Shipowner, in its interrogatories to Shipper, attempted to discover specifics about the design, construction, quality control, inspection and load testing of the pallets before use; it also sought from the Shipper a pre-palletized unit similar to the one which broke, for the purposes of inspection. Although the Shipper responded affirmatively to the latter request, the unit was not produced, forcing the Shipowner to obtain an order to show cause from the district court. 17 Additionally, the Shipper's answers to many of the interrogatories were simply not responsive. For example, in answer to questions about load testing, the Shipper discussed the strength of the type of wood used. 18 25 This Court has previously noted that, particularly in admiralty suits, the non-production of material evidence which is in the control of a party raises an inference that the evidence is unfavorable to that party. . . . The inference raised has been said to be sufficient to decide a close case. Tupman Thurlow Co., Inc. v. S.S. Cap Castillo, 490 F.2d 302, 308 (2d Cir. 1974). The Shipper here offered no evidence in rebuttal to show any testing or examination of the pallets prior to use. While non-production alone may not be the determinative factor, Hellenic Lines Ltd. v. Life Ins. Corp. of India, 526 F.2d 830, 832 (2d Cir. 1975), here, in addition to the Shipper's failure to reveal any measures taken to discharge his affirmative duty to inspect and its failure to provide a unit like that which caused the injury, the evidence detailed above supported a finding of a defect in the materials used or in the construction of the pallet. The jury thus was entitled to conclude that the additional information in the possession of the Shipper would have been unfavorable to it. 26 Finally, although the jury's verdict for the longshoreman was generous, it was not so excessive as to shock the court's conscience, Williamson v. Compania Anonima Venezolana De Navigacion, 446 F.2d 1339, 1342 (2d Cir. 1971), cert. denied, 404 U.S. 1059, 92 S.Ct. 739, 30 L.Ed.2d 746 (1972), since plaintiff did suffer permanent restriction of movement as a result of the accident. 27 Affirmed.