## Facts

- Oxford Shipping Co., Ltd. owned the cargo vessel *Eastern Saga* and agreed to transport scrap metal for Avon Trading Corporation to a Korean buyer, Yulsan.
- Avon contracted to supply about 20,000 tons of scrap but intended to ship only about 17,000 tons.
- To support the higher figure, New Hampshire Trading Corp. (through its president, Frederic W. Gendron) issued documentation overstating the quantity of scrap supplied to Avon.
- Oxford retained Tager Steamship Agency to handle shipping formalities and issue bills of lading.
- Relying on the inflated documentation, Tager issued a bill of lading stating that roughly 20,000 tons were loaded, though the actual cargo was about 17,000 tons.
- During the voyage, Avon employees urged Oxford’s ship personnel to pump water into ballast tanks to increase draft and make the ship appear more heavily laden; Oxford’s personnel refused but did not report the attempt to Oxford’s management.
- Upon arrival in Korea, Yulsan discovered the shortfall after paying based on the paperwork; Korean authorities seized the *Eastern Saga*, causing Oxford major losses.
- Oxford sued Avon, New Hampshire Trading, Gendron, and Tager, asserting claims including negligence, breach of duty, and misrepresentation, seeking damages tied to the seizure.

## Issues

1. Whether negligence by some of a principal’s agents may be imputed to the principal as contributory negligence that bars the principal’s claims against a different agent that breached fiduciary duties.
2. Whether such imputed contributory negligence can also bar the principal’s recovery against third parties who participated in, or facilitated, the wrongful conduct that caused the principal’s loss.

## Decision

- The First Circuit reversed the district court’s judgment to the extent it rested on a broad imputed-contributory-negligence bar and remanded for further proceedings.
- The court left undisturbed the determination that Tager, acting as Oxford’s agent, negligently issued the overstated bill of lading and thereby breached duties owed to Oxford.
- The court rejected the view that Oxford’s ship personnel’s failure to report Avon’s attempted ballast scheme automatically defeated Oxford’s claims against Tager and other defendants.

## Legal Principles

- Imputation rules that support vicarious liability to third parties do not automatically operate as a complete defense to a principal’s affirmative claims against other agents or third-party wrongdoers.
- A principal is not categorically barred from recovering from an agent who breached fiduciary or other duties to the principal merely because a separate group of the principal’s agents was also negligent.
- Courts should assess imputation and contributory-fault defenses in light of the parties’ distinct duties and roles; doctrines of agency should not be applied so broadly that they function as a blanket shield for an agent’s own breach or for third-party misconduct.

## Conclusion

The First Circuit held that the negligence of one set of a principal’s agents is not an automatic, across-the-board bar to the principal’s recovery against a different agent that breached duties to the principal or against third parties involved in the wrongdoing, and it remanded for further proceedings consistent with those limits on imputed contributory negligence.


Oxford Shipping Co. v. New Hampshire Trading Corp., 697 F.2d 1 (1st Cir. 1982)