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LEATHER'S BEST INC. v. S.S. MORMACLYNX

June 5, 1970

LEATHER'S BEST INC., Plaintiff,
v.
S.S. MORMACLYNX, her engines, boilers, etc., v. MOORE-McCORMACK LINES INC., Tidewater Terminal, Inc., and Universal Terminal and Stevedoring Corp., Defendants


Judd, District Judge.


The opinion of the court was delivered by: JUDD

MEMORANDUM OF DECISION

JUDD, District Judge.

 Plaintiff seeks damages for the loss of cargo shipped from Europe to New York in a container. The general admiralty jurisdiction of this court has been invoked. The action was tried to the court. This memorandum includes the required findings of fact and conclusions of law, but the court has also marked plaintiff's proposed findings and conclusions.

 The parties are the steamship Mormaclynx, its owner, Moore-McCormack Lines, Inc. and a Moore-McCormack subsidiary, Tidewater Terminal, Inc. which had charge of the pier where the vessel unloaded in Brooklyn, New York. Plaintiff also made the stevedore, Universal Terminal and Stevedoring Corp. a defendant, but consented to a dismissal of its complaint against this defendant during the course of the trial.

 The case has been elaborately prepared and briefed as a test of a new bill of lading clause which purports to treat a container as a single package for purposes of statutory limitation of liability. Under the facts of this case, the court holds that the $500 limitation applies to the 99 individual bales shipped in the container and not to the container as a unit.

 Facts

 The principal facts in this case are undisputed.

 Plaintiff purchased approximately eleven tons of leather from Carl Freudenberg, a German leather manufacturer, in 1967. Freudenberg employees withdrew the leather from their warehouse, packed it in cartons and checked it against the packing slips. It was loaded into 99 cartons of an average size of approximately 46 feet long, 2 feet wide and 1 1/2 feet high. Steel straps were placed around each carton, both for protection and in order to qualify them as bales under the applicable tariffs. Gross, tare and net weights were recorded, and the bales were then put aside to wait for one of defendants' containers. The leather was in flawless condition when packed.

 At the request of the Freudenberg firm, a truckman engaged by defendant Moore-McCormack's agent in Germany delivered a container to the Freudenberg plant in Weinheim, Germany, on April 14, 1967. The 99 bales of leather were loaded into the container under the supervision of the truck driver, who gave his receipt for 99 bales of leather, helped close the doors, and watched while the container was sealed. He delivered the container without incident to the defendant ship at Antwerp, Belgium.

 The bill of lading was issued by Moore-McCormack's agent, naming plaintiff as the one to whom the Arrival Notice was to be addressed.

 After the Mormaclynx docked in New York, the container was unloaded on Saturday, April 25, 1967 by Universal Terminal and Stevedoring Corp., an independent stevedore. Employees of Tidewater Terminal, Inc. then placed the container on a bogie, and hauled it to a storage area on the pier to await plaintiff's arrival.

 On Monday, April 27, 1967, plaintiff's truckman came to the pier at 9:30 a.m. to pick up the container. The container could not be found, and the police were notified. The next day, the empty container was located in Freeport, Long Island, but the goods have not been recovered.

 Plaintiff's traffic manager was familiar with ocean tariffs and bills of lading. He received about one container a week from Freudenberg. The freight rate was computed on a unit rate per thousand kilograms, less a discount for the use of the ship's container. The traffic manager testified that all lines in the North Atlantic Westbound Conference charged the same rates. He did not declare any excess valuation in this case, and in fact, never did so.

 The leather was insured under a cargo loss policy. Payment of the loss was received on a loan receipt basis, and the present suit is brought by the cargo insurer in the name of the consignee.

 Testimony was introduced establishing the New York sound market value of the goods to be $155,192.47. This figure was not challenged by the defendants, except as they claim that the bill of lading limits their liability.

 The Bill of Lading

 The bill of lading under the column "Marks & Nos." sets forth the following legends:

 "C F W

 New York

 Made in Germany

 2202/1-99

 Container nr. 209134

 UB 9622

 HOUSE-TO-HOUSE

 Seal Nr. 26844

 SHIPPER'S LOAD AND COUNT"

 Under the column, "Number and kind of packages: description of goods," the bill of lading states:

 "1 container s.t.c.

 99 bales of leather"

 (s.t.c. is the abbreviation for "said to contain.")

 Under the column "Gross weight," it states:

 "10864 kos."

 Several other provisions of the bill of lading are relevant to the present dispute. On the face of the bill of lading is stamped the following provision, all in capital letters:

 
"SHIPPER HEREBY AGREES THAT CARRIER'S LIABILITY IS LIMITED TO $500, with respect to the entire contents of each container except when shipper declares a higher valuation and shall have paid additional freight on such declared valuation pursuant to appropriate rule in the continental north atlantic westbound freight conference tariff."

 The printed receipt form on the face of the bill of lading states, among other things:

 
"Weight, measurement, quality, quantity, contents, condition, marks, numbers and value although declared by the Shipper in this Bill of Lading shall be considered as unknown to the Carrier unless expressly recognized and agreed to the contrary. The signing of ...

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