Plaintiff seeks $62,500 for damage to a machine that
allegedly occurred while the machine was in transit between
Busan, Korea, and South Kearny, New Jersey. Defendant
Consolidated Rail Corporation ("Conrail"), has moved for
partial summary judgment, pursuant to Federal Rule of Civil
Procedure 56, seeking to limit its potential liability to $500
under 46 U.S.C.App. §§ 1300-1315, the Carriage of Goods by Sea
Plaintiff Lucky-Goldstar Int'l (America), Inc., ("Lucky"),
seeks recovery of $62,500 from the above-named defendants for
damage to an injection molding machine (the "shipment"), which
allegedly occurred during a three-stage journey from Busan,
Korea to Seattle, from Seattle to Chicago, and from Chicago to
South Kearny, New Jersey.
While Conrail did not initially submit a 3(g) statement with
its motion, it has provided the Court with supporting
affidavits. These affidavits, considered with Conrail's moving
papers, Lucky's brief and affidavit in response, and the briefs
and affidavits of the two co-defendants, clearly establish the
scope of Conrail's motion. Where the facts required by the 3(g)
statement can be gleaned from other documents submitted in
support and opposition to the motion, failure to comply with
Rule 3(g) does not compel denial. See Miller v. Swissre Holding
Inc., 731 F. Supp. 129, 130 (S.D.N.Y. 1990) (declining to
dismiss for failure to submit 3(g) statement). Moreover,
Conrail has submitted the necessary 3(g) statement with its
Because it has failed to establish — or even claim — that
it was either a "carrier" or a "ship," Conrail has not shown
that the protection of COGSA is directly applicable to it.
Conrail has not established that it had a direct contractual
relationship with Uni, the shipper, and thus Conrail cannot be
considered a "carrier" under the statute. Similarly, Conrail's
rail cars obviously cannot be considered "ships." Consequently,
Conrail is not directly entitled to COGSA protection.
Conrail argues that although COGSA does not directly apply to
it, COGSA's protection was contractually extended to it in
Clause Five of the Mitsui Bill of Lading. Parties to a bill of
lading can include in the bill a "Himalaya" clause
extend contractually COGSA liability protection to third
parties that would not otherwise fall within the scope of the
statute. Robert C. Herd & Co. v. Krawill Mach. Corp.,
, 79 S.Ct. 766, 3 L.Ed.2d 820 (1959); Toyomenka, Inc. v.
S.S. Tosaharu Maru,
(2d Cir. 1975); Cabot Corp. v.
, 478-79 (2d Cir.), cert. denied,
, 30 L.Ed.2d 96 (1971).
Clause Five of the Mitsui Bill of Lading is such a Himalaya
clause. It provides, in part, that
Conrail argues that it was a Mitsui sub-contractor, and that
therefore it falls within Clause Five, providing it with the
same limited liability Mitsui enjoys under COGSA. Conrail,
however, has not met its burden of showing that the parties to
the Mitsui Bill of Lading clearly intended Conrail to be a
third-party beneficiary of the contract between them.
Restatement (Second) of Contracts § 302(1) (1981).
In discussing the standard that the courts should apply in
reviewing bills of lading purporting to extend COGSA protection
beyond the carrier or ship, the Supreme Court has held that,
"contracts purporting to grant . . . limitation from liability
must be strictly construed and limited to intended
beneficiaries, for they `are not to be applied to alter
familiar rules visiting liability upon a tortfeasor for the
consequences of his negligence, unless the clarity of the
language used expresses such to be the understanding of the
contracting parties.'" Robert C. Herd & Co., supra, 359 U.S. at
305, 79 S.Ct. at 771 (quoting Boston Metals Co. v. The Winding
Gulf, 349 U.S. 122, 123-24, 75 S.Ct. 649, 650-51, 99 L.Ed. 933
(1955) (Frankfurter, J., concurring)). Similarly, the Second
Circuit has held that although the $500 liability limit
provided by COGSA may be extended to third parties, "[s]uch a
limitation of common law liability . . . must be clearly
expressed. A bill of lading containing such a limitation will
be strictly construed against the parties whom it is claimed to
benefit." Toyomenka, supra, 523 F.2d at 520-21 (citations
Conrail has not provided any convincing evidence regarding
Lucky's, Mitsui's or Haniel's intentions with respect to which
parties should be afforded limited liability. The language of
Clause Five is not sufficient, by itself, to extend protection
to Conrail without clear evidence of the parties' intent to do
so. See Rupp v. International Terminal Operating Co.,
479 F.2d 674, 676-677 (2d Cir. 1973) (refusing to extend liability
limitations where the bill of lading is ambiguous as to the
parties covered). "[D]isputed questions regarding the parties'
intentions should not be adjudicated on a motion for summary
judgment based on affidavits and depositions but rather should
await trial." Savarin Corp. v. National Bank of Pakistan,
290 F. Supp. 285 (S.D.N.Y. 1968), aff'd, 447 F.2d 727 (2d Cir.
Furthermore, the field of international shipping is
particularly noted for the exactitude of its documentation.
"[I]t is important to bear in mind that we are dealing in a
field where recognition of technical precision of language has
been the benchmark." Toyomenka, supra, 523 F.2d at 520 (finding
bills of lading lacked sufficient clarity and precision to
permit extension of limited liability under COGSA). Thus, when
construing admiralty contracts, the Court may "not stretch the
language when the party drafting such a form contract has not
included a provision it easily might have." The Monrosa v.
Carbon Black Export, Inc., 359 U.S. 180, 183, 79 S.Ct. 710,
712, 3 L.Ed.2d 723 (1959).
If the parties to the Mitsui Bill of Lading had intended to
include Conrail among those protected by Clause Five, little
effort would have been required for them to have added to that
clause the term "inland carriers," for example. See, e.g.,
Tokio Marine & Fire Ins. Co. v. Hyundai Merchant Marine Co.,
717 F. Supp. 1307, 1309 (N.D.Ill. 1989) (where Himalaya clause
expressly extends COGSA protection to "inland carrier,"
railroad is protected). The absence of the phrase "inland
carriers" in Clause Five is particularly significant
considering the fact that the term is used elsewhere in the
bill of lading. See Royal Insurance v. Westwood Transpacific
Service, No. C-88-832M (W.D.Wash. April 25, 1990) (absence of
any explicit reference to "inland carriers" in Himalaya clause
is of particular significance where term is used elsewhere in
bill of lading, distinguishing Tokio Marine, supra, 717 F. Supp. 1307,
and finding railroad not entitled to COGSA protection).
Clause Twenty, for example, uses the term "inland carriers" in
discussing delivery of the shipment. Similarly, Clause Seven
uses the narrow phrase "carriage by . . . inland waterways"
rather than the broader phrase "inland carriage" or "inland
transportation." If the parties had intended to extend Clause
Five of the Mitsui Bill of Lading to inland carriers such as
Conrail, the Court would expect to find explicit language to
that effect. Absent such language or any other proof of the
parties' intentions, the Court must find that Conrail has
failed to prove that it falls within the
protection of Clause Five.*fn2
Conrail has likewise failed to provide any evidence to
establish that the parties intended Clause Five's protection of
Mitsui's "servant[s], agent[s] and sub-contractor[s]" to
include parties, such as Conrail, that contracted not with
Mitsui, but rather with a separate entity such as MOL.
Moreover, Conrail has not clearly established the nature of its
relationship with MOL or the nature of the relationship between
MOL and Mitsui. Consequently, since Conrail has not established
satisfactorily either the intended scope of the term
"sub-contractor," or the nature of its position in the
contractual chain, its motion for summary judgment must be
The cases cited by Conrail in support of its motion are
distinguishable from the present case. For example, Conrail
cites Brown & Root, Inc. v. M/V Peisander, 648 F.2d 415 (5th
Cir. 1981) as bringing it within the range of COGSA protection.
In that case, however, the stevedores claiming COGSA protection
were specifically mentioned in the bill of lading. Brown &
Root, supra, 648 F.2d at 418. Similarly, Secrest Machine Corp.
v. S.S. Tiber, 450 F.2d 285 (5th Cir. 1971), is also inapposite
here. In Secrest, the Fifth Circuit granted stevedores
protection under § 1304(5) based on the finding that stevedores
came within the protection afforded in the bill of lading to
"carrier's agents and independent contractors performing
carrier's obligations." In that case, however, the stevedores
had contracted with the carrier directly, whereas here Conrail
contracted with MOL. Since, as discussed above, the scope of
the term "sub-contractor" as it is used in Clause Five is
unclear, Secrest is distinguishable from the case at bar.
Finally, Conrail relies on Tokio Marine & Fire Ins. Co. v.
Hyundai Merchant Marine Co., 717 F. Supp. 1307 (N.D.Ill. 1989).
In Tokio, however, the relevant clause explicitly referred to
"inland carriers" as beneficiaries of the liability
limitations. In this case Clause Five makes no such allowance.
Conrail has failed to establish that it is directly protected
by COGSA. Similarly, Conrail has failed to show with sufficient
specificity any relationship with Mitsui which brings Conrail
within the protection of Clause Five of the Mitsui Bill of
Lading. Strict construction of the terms of the Mitsui Bill of
Lading is mandated by precedent, and specific language
recognizing Conrail as a contractually contemplated protected
party has not been shown. Accordingly, Conrail's motion for
partial summary judgment is denied.