UNITED STATES v. STEPHEN BROTHERS LINE

JOHN R. BROWN, Chief Judge:

Now in its sixth decade the Shipping Act of 1916 affords the basis for the first and only suit for severe civil penalties brought by the Government for failure of a water carrier in foreign commerce to file appropriate tariffs. A second count asserted like penalties under the Intercoastal Shipping Act, a later 1933 enactment. The Government lost both counts, the foreign commerce claim at the close of the Government's evidence, the second at the conclusion of the carrier's case. The big issue1 as to each was whether the carrier's activity was that of a common carrier by water, not a tramp or so-called contract or private carrier. We reverse as to the foreign commerce count but affirm as to domestic-interterritorial commerce.

The case got off to a bad start largely because someone, presumably in Washington, D.C. was mixed up, not on law, but on geography. Thus, the complaint, in its first count alleged that the Carrier2 was engaged in common carriage in foreign commerce between Miami, Florida and "Central and South American ports." The proof, all received without objection and virtually without the slightest real contradiction, showed extensive operations between Miami and the Dominican Republic — an island near, but hardly in, either Central or South America. It was largely this disparity between pleading and proof on geography which scuttled that count. The second one based on shipments from Miami to the Virgin Islands, a United States territory, seems to have stranded on some credibility choices in a structure of proof that left much to be desired.

Although the Shipping Act of 1916, 46 U.S.C.A. § 801 et seq., had always required a common carrier by water in foreign commerce to "establish, observe and enforce just and reasonable rates, * * * and tariffs" and to "file with the [Shipping] Board and keep open to public inspection," 46 U.S.C.A. § 817, prescribed information about rates and tariffs it was the radical revision of the Act in 1961 which precipitates this litigation. Under the structure of the initial Act all the carrier had to file was a schedule of maximum rates. Similarly, the prohibition on charges collected merely forbade the carrier to "demand, charge, or collect a greater compensation" than the filed rates. It was, therefore, a structure of a published mandatory ceiling, not a floor, or a ceiling and floor.

All this was changed in the 1961 revision.3 Now for the first time in the nation's history and its legislative efforts to maintain a strong merchant marine the law compelled such a carrier to maintain, file and enforce published tariffs reflecting, not the minimum, not the maximum, but the one and only rate to be charged and collected for the specified transportation service.4

No such problems arise under the Intercoastal Shipping Act since, as with domestic carriers generally, it had long called for tariffs reflecting the only basis for charges.5

The statutory definition of "common carrier" — such as it is — in the Shipping Act of 1916 applies to both.6 Actually the statutory provision is concerned primarily with defining the categories of "foreign," "interstate," "water carrier," since the expressed standard of reference is that of a "common carrier," not who is a common carrier.7 To this absence of a clearly defined legislative delineation must be added a further complication. Expressly excluded from the category of common carrier by water in foreign commerce is — in the colorful language of the sea — "a cargo boat commonly called an ocean tramp." (See note 7 supra).8

But this neither stymies nor complicates regulation. First, Congress in related legislation, spelled out in codal form9 the traditional notion of what constitutes common carrier service. And the law has long recognized that except for those instances in which the peculiarities of water borne commerce call for specialized treatment the concepts traditionally applied in domestic common carrier transportation situations are to apply to foreign water commerce.10 More than that, Congress, as has everyone else through the centuries of the common law, knows that all know what a common carrier is. So well known is it that we once described it in this fashion: "It is ironic that in a field now so thoroughly fenced in by state and federal legislative declarations of policy, in the journey we make for solution, we must work with ancient markers whose general fitness is reflected by their adaptability to the changing world of commerce and transportation. Indeed, at one point in the trip as we leave the broad superhighway with its temptations toward high compression freewheeling adjudication and proceed down the narrow one-way lane of Erie [Erie R. Co. v. Tompkins, 304 U.S. 64, 58 S.Ct. 817, 82 L.Ed. 1188], we must pay at least a wayside stop to consider whether a Mississippi mule and wagon decision fixes the law for the internal combustion day as well. * * * The salient characteristic of a common carrier is that `He must be engaged in the business of carrying goods for others as a public employment, and must hold himself out as ready to engage in the transportation of goods for persons generally * * * [and] holds himself out as ready to engage in the transportation of goods for hire as a public employment, * * * and * * *, undertakes to carry for all persons indifferently * * *,' 13 C.J.S. Carriers § 3. And to state it conversely, those who `* * * do not hold themselves out as willing to serve the public indiscriminately, are not common carriers; * * *,' 13 C.J.S. Carriers § 8. Hornsby v. Logaras, 210 Miss. 512, 49 So.2d 837: * * *"11 Another time we said this: "There are many ways to say it, but none is better than the familiar one that `the distinctive characteristic of a common carrier is that he undertakes to carry for all people indifferently * * *.' 9 Am.Jur., Carriers, § 4, p. 431." Semon v. Royal Indemnity Co., 5 Cir., 1960, 279 F.2d 737, 739.

And the traditional phrasing that a common carrier is "one who undertakes for hire to transport from place to place the property of others who may choose to employ him * * *." State of Washington ex rel. Stimson Lumber Co. v. Kuykendall, 275 U.S. 207, 211, 45 S.Ct. 41, 72 L.Ed. 241 is echoed by administrative agencies12 charged with the statutory duty of regulating water carriers,13 with no necessity, as apparently supposed by the Trial Judge, that there be some specific solicitation in14 connection with the maintenance of some "predetermined" and "regular" schedule of sailings.15

By any or all standards the Carrier's operations of its M/V Zaida was that of a common carrier in foreign commerce.16 Inward and outward Customs manifests reflected hundreds of shipments of a wide variety of cargo running the gamut from automobiles, buses, groceries, gas ranges, freezers to veils and hat linings. Shipments of this kind had come from active solicitation by the Carrier among established freight forwarders whose compensation frequently came from the fees paid by the Carrier.17 And all the while, during a 28 month period the M/V Zaida with a regularity almost matching the Staten Island Ferry made 28 round trips from Miami to the Dominican Republic.

In the face of this and the appropriate standards the Trial Court's finding that the government had failed to show that the Carrier "had any pre-arranged definite schedule to make these trips, or that any definite and regular schedule was maintained" was irrelevant and its further finding that the Carrier "solicited cargo from shippers and freight forwarders, and then sent its ships to those places to which the owners of the cargo directed him" was factually clearly unsupported. Actually, of course, the Judge did not make such findings on the evidence as such. Rather, he did it on the evidence measured against the pleading allegation of common carriage between Miami and "Central and South American ports." Consequently to sustain the findings we must sustain the ruling of a fatal variance between pleading and proof and the refusal to allow the Government to amend its complaint.

But "it is too late in the day and entirely contrary to the spirit of the Federal Rules of Civil Procedure for decisions on the merits to be avoided on the basis of such mere technicalities." Foman v. Davis, 1962, 371 U.S. 178, 181, 83 S.Ct. 227, 230, 9 L.Ed.2d 222. Whether we would go so far as the Second Circuit that the effect of F.R.Civ.P. 15(b) "is mandatory, not merely permissive"18 we are committed to "* * * a course of `strong liberality * * * in allowing amendments.'" Hall v. National Supply Co., 5 Cir., 1959, 270 F.2d 379, 383. To rule otherwise would be to frustrate the "affirmative policy" of F.R.Civ.P. 15(b), Lone Star Motor Import, Inc. v. Citroen Cars Corp., 5 Cir., 1961, 288 F.2d 69, 75.

Detailed answers by the Government to the Carrier's interrogatories plus the pretrial production of Customs' manifests told the Carrier what it, better than anyone else, already knew about its own operations. To this was added the uncontradicted testimony of a half-dozen freight forwarder live swearers. Not a cheep of an objection was ever sounded that evidence concerning the Dominican Republic was beyond the scope of "Central and South American" pleadings. There was, in the words of F.R.Civ.P. 15(b) a trial of the issue "by express or implied consent." And as in June T., Inc. v. King, 5 Cir., 1961, 290 F.2d 404, 407, 1961 A.M.C. 1431, "[t]here can be no suggestion here of surprise or unfair advantage or any inability to meet adequately a new issue." We can appreciate the Judge's impatience with such unseeworthy, United States Lines, Inc. v. Williams, 5 Cir., 365 F.2d 332, 336, preparation but the only surprise was, we venture, the Carrier's surprise at winning on the pleadings. Skeletons would rattle, O'Neal v. United States, 5 Cir. 1959, 264 F.2d 809, 814 (dissenting), were this ruling to stand.

But on the Intercoastal Shipping Act count19 we think that the Judge's fact findings meet the Plimsoll mark of F.R.Civ.P. 52(a). Only about ten shipments were involved, mostly of refrigerated cargoes generated by McDonald. Whether it was the Carrier or McDonald who was acting in the capacity of the transporter vis-a-vis the cargo20 was a hotly disputed question. The Court could have found that it was the Carrier but it was not compelled to. In the Government's evidentiary structure there were a lot of loose ends. And that is the bitter end as well. S/S Bethflor v. Thomas, 5 Cir., 1967, 364 F.2d 634, 637.

The upshot is that the case must now go back for the Court, after such further hearing as is appropriate, to fix the penalties for violating § 18(b) (6), 46 U.S.C.A. § 817(b) (6).

Affirmed in part.

Reversed and remanded in part.