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MOORE-MCCORMACK LINES, INC. v. UNITED STATES

July 15, 1971

MOORE-McCORMACK LINES, INCORPORATED, as Owner of the SS ROBIN HOOD, Plaintiff,
v.
UNITED STATES of America, as Time Charterer of said SS ROBIN HOOD, Defendant and Third-Party Plaintiff, v. STATES MARINE CORPORATION OF DELAWARE, Third-Party Defendant


Croake, District Judge.


The opinion of the court was delivered by: CROAKE

MEMORANDUM

CROAKE, District Judge.

 This action, brought under 46 U.S.C. §§ 741-752, asserts a claim for damages allegedly incurred through the negligence of the defendant. Three parties are involved; the United States ("the Government"), States Marine Corporation of Delaware ("States Marine"), and Moore-McCormack Lines, Inc. ("Moore").

 The controversy arises out of damage to a vessel, SS ROBIN HOOD, owned by Moore and time chartered by States Marine, which used it at least in part in fulfilling Contract No. MST-61 ("the MST contract"), a contract of affreightment between States Marine and the Military Sea Transportation Service, a Governmental agency.

 The Government has now moved for judgment of dismissal on the pleadings, pursuant to Rule 12(c), F.R. Civ. P. In so far as its motion includes reference to information and admissions obtained through pre-trial investigation, the motion will be treated as one for summary judgment, also pursuant to Rule 12(c).

 From May 22 to May 29, 1965, while the relevant contracts were in force, the SS ROBIN HOOD lay at anchor at Inchon, Korea, discharging both governmental and nongovernmental, commercial cargo. Plaintiff alleges that damage in the amount of $57,729.00 was caused to the vessel through the negligence of the Government in unloading its cargo. The Government, on the other hand, claims that the damage was incurred during the commercial operations. In the alternative, it demands indemnity from any liability from States Marine.

 In any event, all parties agree that the Government was not notified of the alleged damage before the ship left Korea. At issue is the significance of this omission.

 The Government's contention is that the requirement of notice is a valid limitation of negligence liability, and that in the present circumstances breach of this contractual duty prevents recovery in tort. The contractual language upon which the Government relies is found in Article 5, Paragraph (g) of the amendment to the contract:

 
"(g) . . . The Government shall not be liable for the repair of any damage under this Article 5(g) unless written notice specifying such damage and the name(s) of the party or parties causing such damage shall have been given to the Government or its authorized representative, as soon as possible after the occurrence of such damage, or in any event before the vessel leaves the berth or anchorage where the damage occurred . . ."

 Moore, on the other hand, claims that it is not bound by the contract, to which it was not a signatory. Alternatively, it construes the above-quoted language as preventing equitable action for specific performance (repair by the Government) but not an action such as the present, which only seeks damages. And in any event, Moore challenges the validity of the clause in question as violative of public policy.

 Three theories have been asserted as justification for finding Moore to be bound by the above-quoted language. The first is that the time charter contained language either effectively duplicating the notice requirement of the MST contract, or incorporating it by reference. The second is consent to be bound by the MST notice terms. The third is a theory of assignment and delegation.

 With regard to the first and second theories, the extent of Moore's duty to give notice is governed by the relevant notice provision in a Rider incorporated into the time charter:

 
"31. Charterers are not to be responsible for stevedore or other damage to the vessel unless notified in writing by the Master at the time of occurrence of damage; Master is to co-operate with Charterers and Agents in giving prompt notice of claim in writing to party causing such damage."

 This ambiguous clause is legally insufficient to incorporate any provision of the MST contract by reference. The MST contract is neither named nor described nor, for that matter, referred to at all. Lowry & Co. v. SS Le Moyne D'Iberville, 253 F. Supp. 396, 398-399 (S.D.N.Y. 1966); Colonial ...


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