“The steamship 'President Coolidge' arrived in the harbor of Honolulu August 26, 1937, and tied up at pier 8. At about the hour of 10 a.m. of that day, one Norman R. Arthur, a harbor patrol boatman under the United States District Engineer, was passing under the stern of the 'President Coolidge' in a patrol boat, when a quantity of garbage, consisting of cabbage, orange peel, celery, tea leaves, and water, descended upon him, part thereof falling in the water . . . Immediately following his being drenched with the refuse, Arthur cleared his eyes, then looked and saw a person, apparently Chinese, walking away from the stern rail of the Coolidge, carrying a can or bucket . . . Arthur fastened his small boat to the pier, changed clothes and boarded the 'President Coolidge' to make a search for the person responsible. He saw the chief mate and explained what had happened and the officer conducted an investigation, but no further information was secured. There was testimony on behalf of the claimant that orders had been issued by the Company against throwing of refuse from the ship while in harbor; that signs were placed in conspicuous places written in English and Chinese, warning employees not to throw things overboard; that locks were placed upon the slop chutes to prevent their use while in harbor; that the officers of the ship had no knowledge of violation of the law or their orders in this respect and in this instance. Having committed his ship to the seas, an owner takes the risk of much which he cannot easily control. Any other construction would change the statute from one of prohibition to that requiring merely due care. Affirmed.” With these words, on January 23rd, 1939, the Honorable Francis A. Garrecht, a senior ninth circuit court judge, affirmed the District Court of Hawai‘i’s decree, which penalized the corporation that owned the steamship “President Coolidge,” for its employee’s misconduct. No questions were raised regarding what genuine efforts the corporation had made to prevent the violation. Nor were any additional arguments presented concerning other precautionary measures the corporation might have taken to prevent the violation. In fact, it was never argued that the corporation could have exercised more control over its employees or could have prevented their misconduct. Notwithstanding, the corporation was held strictly liable for the misconduct of its employee. In the seven decades since the “President Coolidge” case, corporate enforcement policies around the globe have gone through a sea of change.

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M.G. Faure (Michael)
Erasmus University Rotterdam
EDLE - The European Doctorate in Law and Economics programme
Erasmus School of Law

Oded, S. (2012, March 30). Inducing Corporate Proactive Compliance: liability controls & corporate monitors. EDLE - The European Doctorate in Law and Economics programme. Retrieved from http://hdl.handle.net/1765/32036

Additional Files
SamenvattingNL.pdf Final Version , 181kb
SummaryOded.pdf Final Version , 12kb