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SEGUROS ILLIMANI S.A. v. M/V POPI P

April 13, 1990

SEGUROS "ILLIMANI" S.A., EMPRESA NACIONAL DE FUNDICIONES, DERBY Y CIA, INC. AND S.W. SHATTUCK CHEMICAL CO., PLAINTIFFS,
v.
M/V POPI P, HER ENGINES, BOILERS, ETC., NIMIPET CORP., LINEAS NAVIERAS BOLIVIANAS, COMPANIA SUD AMERICANA DE VAPORES AND CHILEAN LINE, INC., DEFENDANTS. COMPANIA SUD AMERICANA DE VAPORES AND LINEAS NAVIERAS BOLIVIANAS, DEFENDANTS AND THIRD PARTY PLAINTIFFS, V. UNIVERSAL MARITIME SERVICE CORP., THIRD PARTY DEFENDANT.



The opinion of the court was delivered by: Milton Pollack, Senior District Judge.

DECISION and OPINION

SUMMARY

Having heard and seen the witnesses and considered all documentary evidence and having evaluated all of the facts and circumstances herein, I decide and find as follows:

The Carriage of Goods by Sea Act (COGSA) 46 U.S.C.App. § 1300, et seq., applies to the shipment and the loss of the tin ingots involved therefrom.

The shipment could not be mistaken to be other than a shipment of 600 packages or bundles into which 8,996 ingots were packaged. The bundles or packages, each consisting of 15 ingots (except one package of 11), were each separately bound by steel straps. The two containers herein involved 67 packages or bundles containing 1,005 ingots, packaged as mentioned, and were shipped that way. The bills of lading and their content must be read and understood in the light of the clear intent that 600 bundles in total were involved which is supported by the collateral evidence that the quantity references in the bills of lading were intended to embrace packages or bundles wrapping 15 ingots per package or bundle, and individual ingots were not intended to be individual, separate packages.

The ingots were aboard the rail cars referred to in the evidence; were initially stored in Warehouse No. 5 at Arica, Chile; were packaged into 600 bundles or packages; were delivered to and stored in steel strapped packaged or bundled groups and placed in 18 containers; all bundles or packages were separately strapped with steel bands around each bundle; were all loaded on the Popi at Arica, Chile; remained intact during its voyage to New York; were off-loaded from the ship intact and placed intact in the custody and control of the stevedore, Universal Maritime Services Corp.; that 67 packages of ingots shipped and so off-loaded involving a total of 1,005 ingots were found to be missing; the container had been opened and invaded without breaking the seals; the packages of ingots were removed and not delivered to the consignees in New York as a result of the fault of the stevedore. From the evidence presented and the legitimate inferences therefrom, I find that the plaintiffs and third-party plaintiffs have sustained the burden of proof that the removal of the ingots occurred while the containers were in the custody and control of the stevedores. The evidence of the third-party defendant did not satisfactorily or credibly meet or overcome the prima facie proof of the third-party plaintiffs that the loss occurred while the containers were in the possession or under the control of the stevedores. The issues of credibility involved with respect to the loss are resolved in favor of the plaintiffs and third-party plaintiffs against the third-party defendant.

OPINION

1. Jurisdiction

The claims against the ship, carriers and charterers fall within the scope of this Court's admiralty jurisdiction. See 28 U.S.C. § 1333(1).*fn1 However, any claim against Universal Maritime arose while the cargo was on land and is grounded on state law and is not within federal admiralty jurisdiction. See, Roco Carriers Ltd. v. M/V Nurnberg Express, 899 F.2d 1292, 1294 (2d Cir. 1990). The validity of jurisdiction over a third-party defendant is grounded in the concept of pendent party jurisdiction. The Second Circuit has recently reaffirmed the availability of pendent party jurisdiction in admiralty cases even in light of the Supreme Court's holding in Finley v. United States, ___ U.S. ___, 109 S.Ct. 2003, 104 L.Ed.2d 593 (1989).

Roco Carriers, at 1297.

2. COGSA

a. Applicability

The Carriage of Goods by Sea Act (COGSA), 46 U.S.C. App. §§ 1300-1315, governs the rights of the parties while the cargo is on the ship.

The plaintiffs argue that COGSA should not limit its recovery in this case if the loss occurred before loading or after discharge.

Paragraph 2(a) of the bill of lading states:

  If this Bill of Lading is issued exclusively for
  the carriage of goods by sea the carrier shall be
  responsible subject to the provisions of the
  Carriage of Goods by Sea Act of the United States,
  approved April 16, 1936 in case of a carriage of
  goods from ports of the United States, or, in case
  of a carriage from ports of Canada, subject to the
  provisions of the Water Carriage of Goods Act of
  Canada, approved August 1, 1936, and the said
  provisions shall be deemed to be incorporated
  herein. The provisions stated in the said Acts
  shall also govern before the goods are loaded on
  and after they are discharged from the ship,
  however, restricted to the time when the goods are
  in the actual custody of the carrier. The carrier
  shall not be liable in any capacity whatsoever
  while the goods are not in his actual custody.

Plaintiffs argue that the bill of lading only extends COGSA to cover these periods in voyages from the United States.

When read in conjunction with COGSA, however, it is clear that ¶ 2(a) extends coverage on all voyages. COGSA requires bills of lading for voyages from the United States to contain a statement expressly including COGSA's terms.*fn2 The first sentence of ¶ 2(a) does exactly this. The second sentence then states at what other times COGSA will apply. The plaintiffs' argument that the first sentence modifies the second is not persuasive. The second sentence states that COGSA "shall also govern" before loading and after discharge. (Emphasis added). It is an additional term, not one dependent on the sentence before it.

The bills of lading also contain a so-called "Himalaya" clause extending coverage to "servants, employees and agents of the carrier as well as of such independent contractors (including their servants, employees and agents) whose services the carrier from time to time may engage in the operation of the vessel or any other means of transportation including loading, discharging and all services in connection herewith." Stevedores are included in the term "independent contractor."

  Whether a bill of lading extends limitations of
  liability to stevedores depends on whether "the
  clarity of the language used expresses such to be
  the understanding of the contracting parties."
  Robert C. Herd & Co. v. Krawill Machinery Corp.,
  359 U.S. [297] at 305 [79 S.Ct. 766, 771, 3 L.Ed.2d
  820 (1959)] . . . Two circuits have recently held
  that a bill of lading mentioning independent
  contractors clearly includes stevedores. Bernard
  Screen Printing Corp. v. Meyer Line, 464 F.2d 934,
  936 n. 1 (2d Cir. 1972), cert. denied, 410 U.S. 910
  [93 S.Ct. 966, 35 L.Ed.2d 272] . . . (1973);
  Seacrest Machine Corp. v. S.S. Tiber, 450 F.2d 285,
  287 (5th Cir. 1971). The language of the district
  court in Bernard Screen is instructive:
    To exclude "stevedores," who are independent
    contractors, from the scope of the more
    inclusive term would, in effect, be holding that
    parties by using

    the more inclusive term had accomplished the
    opposite result.

328 F. Supp. [288] at 290.

Tessler Bros. (B.C.) Ltd. v. Italpacific Line, 494 F.2d 438, 446 ...


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