The opinion of the court was delivered by: Leval, District Judge.
This maritime action concerns two vacuum steam sterilizers
damaged in shipment from New York to Keelung, Japan. Plaintiff
Atlantic Mutual Insurance Company ("AMIC"), a subrogated insurer
of the shipper, Environmental Tectonics, seeks the recovery of
$50,000 from defendants Comet International Transport ("Comet"),
American President Lines and its ship the M/V President Tyler
("APL"), as well as KAM Container Line and CF Ocean Service
("KAM"). Defendant Comet cross-claims for indemnity and
contribution against defendants APL and KAM. Defendant KAM
similarly cross-claims against defendants APL and Comet.
Defendant APL in turn cross-claims against defendant KAM.
Defendant APL moves for summary judgment, arguing that the
complaint and cross-claims against it are time-barred under the
Carriage of Goods by Sea Act, 46 U.S.C.App. §§ 1300 et seq.
(1984) (hereinafter "COGSA"). Defendant Comet also moves for
summary judgment, arguing that the complaint and cross-claim
against it are time-barred.
Environmental Tectonics, Inc., a Pennsylvania Corporation,
plaintiff's subrogor, manufactures and sells vacuum steam
sterilizers. In the fall of 1986, Environmental Tectonics agreed
to sell two boxed vacuum steam sterilizers to Academia Sinica, in
Taipei, Taiwan. On November 24, 1986, Environmental Tectonics
contacted Comet International Transport ("Comet"), a freight
forwarder, and requested Comet's assistance in arranging
transport of the sterilizers to Taiwan. Comet hired KAM Container
Line to carry the sterilizers to Taiwan, and apparently also
arranged for the M/V President Tyler to carry the sterilizers
over the sea to Taiwan. Comet never had actual possession of the
KAM Container Line ("KAM") is a non-vessel operating common
carrier (NVOCC), which also operates a warehouse in Kearny, New
Jersey. Environmental Tectonics delivered the sterilizers to
KAM's warehouse. On or about November 26, 1986, KAM transported
the sterilizers, which it had packed with other cargo in a
container, to a loading dock in New York, where the container was
loaded upon the M/V President
Tyler. The M/V President Tyler is owned and operated by APL. APL
issued one bill of lading for each sterilizer within the
container. The bills of lading named KAM Container Line, U.S.A.
as the shipper and KAM Container Line as the consignee. APL's
vessel sailed from New York for Taiwan. On November 28, 1986,
after the President Tyler had left port, Comet issued a separate
bill of lading covering the entire shipment naming Environmental
Tectonics as shipper and Academia Sinica as consignee. The
shipment was delivered to Taiwanese customs on December 24, 1986.
The goods were "unstuffed" at APL's Container Terminal, were sent
through customs, and arrived at Academia Sinica on January 8,
1987, where the damage was first noticed. A survey on the extent
of the damage was conducted on January 14, 1987, on the premises
of Academia Sinica. It is unclear on the papers whether the goods
were received by Academia Sinica (or an agent) directly from APL,
or from some other carrier in between. A complaint was filed on
November 30, 1988.
I. APL's Motion for Summary Judgment
Defendant APL moves for summary judgment, arguing that the suit
is time-barred under the provisions of COGSA. COGSA governs ocean
carriage pursuant to bills of lading or other documents of title.
46 U.S.C.App. § 1300. Bills of lading must state, in what is
termed a "clause paramount," that they are subject to the express
provisions of COGSA. 46 U.S.C. App. § 1312. COGSA establishes the
responsibilities, liabilities, rights and immunities of the
carrier and the ship. 46 U.S.C. App. § 1305. APL argues that the
instant lawsuit is time-barred under 46 U.S.C.App. § 1303(6),
which provides: "[T]he carrier and the ship shall be discharged
from all liability in respect of loss or damage unless suit is
brought within one year after delivery of the goods or the date
when the goods should have been delivered."
Plaintiff AMIC responds that no bill of lading exists
evidencing a contract of carriage between APL and AMIC, and that
COGSA is therefore inapplicable. AMIC argues that its cause of
action sounds in the common law of bailments, for which the
limitation period is two years.
AMIC's argument is without merit. Assuming arguendo that
AMIC's subrogor is Environmental Tectonics, Academia Sinica, or
another holder of the bill of lading issued by Comet, the terms
of that bill of lading, as a contract of carriage, contemplate
ocean carriage and the applicability of COGSA, in addition to
specifically incorporating the terms of the bill of lading issued
The Comet bill of lading states that the shipment is to be
loaded on the M/V President Tyler in New York. Chang Aff.Ex. G-1.
Furthermore, the front of the Comet bill of lading states that
Comet has received the goods "for shipment included under a
consolidated Ocean Bill of Lading issued and signed by the above
mentioned Steamship Company — all terms, conditions and clauses
printed or otherwise inserted on Steamship Company's Bill of
Lading to apply." Environmental Tectonics, the plaintiff's
subrogor, was thus bound to the terms of the vessel's bill of
lading, incorporated by reference.*fn1
Plaintiff's subrogor was also on notice that COGSA would apply.
Clause 5.0 of the Comet bill of lading contains the Clause
Paramount, stating that ocean carriage pursuant to the bill of
lading shall be governed by the terms of COGSA. AMIC advances no
effective arguments that the
contract was obtained by fraud or that it is otherwise
Even if the bill of lading issued by Comet to the shipper had
not given the shipper full notice that the ocean bill of lading
(and COGSA) would be applicable to the shipment, the shipper
would still be bound to Comet's arrangements of transport. As a
freight forwarder, Comet acted as the agent of the shipper in
arranging transport. Reisman v. Medafrica, 592 F. Supp. ...