Court Opinion

ID: 8972069
Source: CourtListenerOpinion
Date Created: 2022-11-27 10:37:31.115566+00
Date Added: 2024-06-11T17:10:27.639588
License: Public Domain

PRATT, Circuit Judge,
dissenting:
I concur in Part A of the majority opinion. Siderius made out a prima facie case against Amilla; the finding by the district court that the ship was unseaworthy is not clearly erroneous; and the district court’s determination that the ship was unseawor-thy allowed Siderius to recover its resulting damages directly from Amilla.
However, I respectfully dissent from Part B of the opinion, because Canadian was denied a fair opportunity to present its full case against Amilla on the indemnity issue.
At trial Canadian, defending against both the complaint of plaintiff Siderius and the third-party claim of defendant Amilla, had to walk a fine line. Defeating plaintiff Siderius’s overall claim would mean victory for all defendants; but if Siderius should succeed, then Canadian would have to defend against Amilla’s indemnity claim. Thus, Canadian had to decide whether or not to present its own expert evidence that the cargo damage was caused by unseaworthiness of the vessel. To present that evidence would, of course, have strengthened Canadian’s defense against any claim by Amilla for indemnity based upon the interclub agreement, but at the same time it would have strengthened plaintiff Sideri-us’s overall case. Its dilemma was resolved, Canadian thought, when Amilla rested its case without offering the inter-club agreement in evidence or even claiming to rely on the indemnification provision of the agreement. Without an evidentiary basis for liability based on that agreement, Canadian felt it was free of any liability for indemnification based on that ground. Canadian therefore did not present the additional expert evidence it had available on the unseaworthiness issue.
In its decision, however, the district court did rely on the interclub agreement-specifically the court relied on a single provision that Amilla had paraphrased in its posttrial memorandum. Viewed in isolation, that provision seems to call for a 50-50 split of liability between owner and charterer unless there is “clear evidence” that the damage was caused by unseaworthiness. The district court’s reliance on this clause, without notice or warning to anyone, effectively denied Canadian an opportunity to establish “clear evidence” on the seaworthiness issue. Because there was only a “preponderance” of evidence rather than the “clear evidence” required by the interclub agreement, the district court imposed 50% of the liability on Canadian. In the context of this case, that result was unfair.
In the first place, the interclub agreement was never placed in evidence. While it was incorporated by reference into one of the trial exhibits, it was not presented to the court in its entirety. The district court could properly have taken judicial notice of it, because the document was generally in use in the trade and was readily available from undisputed sources. It was improper, however, for the district court to deny Canadian an opportunity to be heard on (1) whether other provisions in the agreement might modify the impact of the single clause it relied upon, (2) whether certain conditions in the agreement properly had been fulfilled, and (3) whether the generally accepted interpretation of the agreement supported the judge’s application of it. Nor, of course, was Canadian permitted an opportunity, assuming the district court’s interpretation of the agreement was correct, to present its “clear” evidence that the damage was caused solely by unseaworthiness.
The majority contends that because Canadian was aware of the potential relevance of the agreement, it did have an “opportunity” to present the required evidence. Such a position unwisely tends to undercut the standard operating procedures in most of our district courts that are designed to narrow issues and confine evidence only to those matters that are in dispute.
Further, since the interclub agreement was not placed in evidence, the only way it could properly have been considered by the district court was through judicial notice. Whether the agreement be viewed as “adjudicative fact” and therefore subject to rule 201 of the Federal Rules of Evidence, or whether it be viewed as a form of pri*669vate law as suggested by the majority, fundamental fairness requires that the court give the parties an opportunity to be heard as to the propriety and import of judicially noticing the proposed material.
As Judge Weinstein points out, “What is important is that procedural fairness demands that the parties have an opportunity to object to the taking of notice.” 1 J. Weinstein & M. Berger, Weinstein’s Evidence ¶ 201[07], at 201-50 (1988). Notice is the explicit requirement before judicially noticing adjudicative facts, Fed.R.Evid. 201(e) (“A party is entitled upon timely request to an opportunity to be heard as to the propriety of taking judicial notice and the tenor of the matter noticed.”), and even matters of foreign law. Fed.R.Civ.P. 44.1 (“A party who intends to raise an issue concerning the law of a foreign country shall give notice by pleadings or other reasonable written notice.”). Notice should also be provided when a court proposes to take notice of legislative facts, 1 J. Wein-stein & M. Berger, Weinstein’s Evidence ¶ 200[03], at 200-16 (1988) (“Informal consultation with the parties enables the court to enlist their aid in obtaining further information, guarantees that differing points of view will be consulted, and is especially appropriate in those cases where the fact the judge is noticing may have adjudicative as well as legislative implications.”). Why the need for fairness and notice disappears where, as here, a provision of private law is judicially noticed, simply escapes me.
No advance warning was given to Canadian’s counsel that the court would judicially notice the agreement. Once it appeared in the final decision that the trial court had relied on the agreement, Canadian’s motion for reargument should have been granted. See Fed.R.Evid. 201(e) (“In the absence of prior notification, the request [for an opportunity to be heard] may be made after judicial notice has been taken.”). Fairness required that Canadian be given the opportunity to present its additional evidence in order to meet the new, higher burden of “clear evidence” imposed by the agreement.
Finally, the entire area of judicial notice is pervaded with distinctions that have proved difficult to apply, e.g., matters of law versus matters of fact, foreign law versus domestic law, legislative fact versus adjudicative fact, critical facts versus peripheral facts. To this array the majority has now added another distinction: “facts extraneous to a record” versus “facts that are integrally related to the record”. Because it views the interclub agreement not as “extraneous”, but as “integrally related” to the record, the majority apparently concludes, first, that the agreement was automatically before the court, even though not in evidence and not relied on by anyone at trial, and, second, that Canadian had no right after the decision was rendered to be heard on the propriety of taking judicial notice of the agreement or to present the additional evidence that was essential to defeat the indemnity provision of the agreement. No authority is given, nor have I found any, which supports this extraneous/integrally related analysis. It can’t be found in rule 201, which applies to adjudicative facts, nor does it comport with the judicial notice doctrine as applied to matters of foreign or private law. Indeed, it seems to run counter, to the critical fact/peripheral fact distinction urged in Wright and Graham. See 21 C. Wright & K. Graham, Federal Practice and Procedure § 5103, at 477-79 (1977 & Supp.1988).
Putting aside the semantic distinctions, however, judicial notice in general is a doctrine that seeks to balance economy in the presentation of information to the court with fairness to the parties. On the district court’s determination of Amilla’s indemnity claim against Canadian in this case, that balance was skewed. Because Canadian did not receive a fair trial on the indemnity issue, the judgment against it should be reversed with a remand for further proceedings.