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SAMSUNG AMERICA, INC. v. M/T FORT PRODUCER

July 27, 1992

SAMSUNG AMERICA, INC., Plaintiff, against M/T FORT PRODUCER, her tackle, boilers, engines, etc., in rem; DITLEV-SIMONSEN, HALFDAN & CO.; SEJERSTED BODTKER, S., & CO. A/S; PORTLEA INC.; CANADIAN PACIFIC SHIPS; CANADIAN PACIFIC (BERMUDA), LTD.; CANADIAN PACIFIC TANKER SERVICES, INC.; and CERES CHEMICAL TANKERS, in personam, Defendants.


The opinion of the court was delivered by: MICHAEL B. MUKASEY

 MICHAEL B. MUKASEY, U.S.D.J.

 Plaintiff Samsung America, Inc. brought this admiralty and maritime action to recover damages under the Carriage of Goods by Sea Act, 46 U.S.C. § 1300 et seq. (1988) ("COGSA"), for the short-delivery of 46.29 metric tons of liquid caustic soda. Defendant Canadian Pacific Ships ("CP Ships") issued the bills of lading; defendant Canadian Pacific (Bermuda) Ltd. ("CP Bermuda") was the chartered owner; and defendant Canadian Pacific Tanker Services ("CP Tanker") was an agent for CP Bermuda. *fn1" Plaintiff moves for summary judgment pursuant to Fed. R. Civ. P. 56. Further, plaintiff moves for sanctions pursuant to Fed. R. Civ. P. 11 and 37. For the reasons set forth below plaintiff's motion for summary judgment is granted; plaintiff's motions for sanctions are denied.

 I.

 On October 27 and 28, 1988 cargo was loaded on board the M/T FORT PRODUCER at Taft, Louisiana. The Commodity Control Services Corporation ("COMTROL"), an independent surveyor, issued a report and an Official Quantity Certificate showing that 4,194.27 metric tons of liquid caustic soda had been loaded into the vessel's number 8 center tank. (Jadhav Aff. Ex. 4) CP Ships issued five bills of lading confirming receipt of 4,194.27 metric tons. (Jadhav Aff. Ex. 1) The bills of lading incorporated terms of a voyage charter party between Samsung as charterer, and CP Bermuda as the chartered owner, for which CP Tanker signed "as agents only." (Jadhav Aff. Ex. 2)

 On or about December 17, 1988, the M/T Fort Producer arrived at the destined port, Ulsan, South Korea, where another independent surveyor, the Korean Inspection & Marine Surveyors Corporation (KIMSCO), measured the quantity of cargo prior to discharge. KIMSCO issued a Certificate of Liquid Gauging, listing that only 4,147.982 metric tons of caustic soda, a shortfall of 46.29 metric tons, were contained within the number 8 tank. (Jadhav Aff. Ex. 5) After the caustic soda had been discharged, KIMSCO issued another Certificate of Liquid Gauging confirming that only 4,145.813 metric tons had been delivered to the shore tanks. (Jadhav Aff. Ex. 5) Thus, 2.169 metric tons were lost in transfer from the number 8 tank to the shore tanks.

 II.

 Fed. R. Civ. P. 56(c) requires a summary judgment if the evidence demonstrates that "there is no genuine issue as to any material fact and [that] the moving party is entitled to judgment as a matter of law." Anderson v. Liberty Lobby Inc., 477 U.S. 242, 250, 91 L. Ed. 2d 202, 106 S. Ct. 2505 (1986). "Summary judgment is properly regarded not as a disfavored procedural shortcut, but rather as an integral part of the Federal Rules as a whole, which are designed to 'secure the just, speedy and inexpensive determination of every action.'" Celotex Corp. v. Catrett, 477 U.S. 317, 327, 91 L. Ed. 2d 265, 106 S. Ct. 2548 (1986) (quoting Fed. R. Civ. P. 1).

 In determining whether there is a genuine issue of material fact, a court must resolve all ambiguities, and draw all inferences, against the moving party. See United States v. Diebold, Inc., 369 U.S. 654, 655, 8 L. Ed. 2d 176, 82 S. Ct. 993 (1962) (per curiam); Donahue v. Windsor Locks Bd. of Fire Comm'rs, 834 F.2d 54, 57 (2d Cir. 1987). However, the mere existence of disputed factual issues is insufficient to defeat a motion for summary judgment. Knight v. United States Fire Ins. Co., 804 F.2d 9, 11-12 (2d Cir. 1986), cert. denied, 480 U.S. 932, 94 L. Ed. 2d 762, 107 S. Ct. 1570 (1987). The disputed issues of fact must be "material to the outcome of the litigation," id. at 11, and must be backed by evidence that would allow "a rational trier of fact to find for the non-moving party." Matsushita Electrical Industrial Co. v. Zenith Radio Corp., 475 U.S. 574, 587, 89 L. Ed. 2d 538, 106 S. Ct. 1348 (1986). The non-movant "must do more than simply show that there is some metaphysical doubt as to the material facts." Id. With respect to materiality, "substantive law will identify which facts are material. Only disputes over facts that might affect the outcome of the suit under the governing law will properly preclude entry of summary judgment. Factual disputes that are irrelevant or unnecessary will not be counted." Anderson, 477 U.S. at 248.

 III.

 Defendants argue that CP Bermuda and CP Tanker are not liable under COGSA because they were not parties to the bills of lading. Every bill of lading, including one issued under or pursuant to a charter party, evidencing a contract for the carriage of goods by sea to or from ports of the United States, in foreign trade, is subject to COGSA. 46 U.S.C. § 1301(b); see Excel Shipping Corp. v. Seatrain Int'l S.A., 584 F. Supp. 734, 746 (S.D.N.Y. 1984); Joo Seng Hong Kong Co. v. S.S. Unibulkfir, 483 F. Supp. 43, 45 (S.D.N.Y. 1979).

 COGSA imposes liability on "carriers" of goods by sea. The definition of "'carrier' includes the owner or the charterer who enters into a contract of carriage with the shipper." 46 U.S.C. § 1301(a). In Joo Seng, the court found strong statutory support for treating all owners and charterers involved in the voyage as COGSA carriers, except when one party expressly assumes exclusive carrier status. Joo Seng Hong Kong, 483 F. Supp. at 46; see also Excel Shipping Corp., 584 F. Supp. at 747. The charterers and owners bear the burden of proving their relationships inter se, and thus, their liability. Joo Seng Hong Kong, 483 F. Supp. at 47. Furthermore, the owners and charterers bear the burden of ascertaining the allocation of loss among themselves. Id.

 In the case at hand, CP Ships, as issuer of the bills of lading, is liable under COGSA. Excel Shipping Corp., 584 F. Supp. at 746. Furthermore, the bills of lading expressly incorporate COGSA. See Leather's Best Int'l Inc. v. MV "Lloyd Sergipe," 760 F. Supp. 301, 308 (S.D.N.Y. 1991).

 Courts have imposed liability also on owners and charterers who are not signatories to a bill of lading if there is "some evidence tying the party to the bill involved." Joo Seng Hong Kong, 483 F. Supp. at 46; see also, Office of Supply v. Naftoporos, 1987 AMC 697, 705. The charter party signed by CP Tanker, as agent for CP Bermuda, included a close tie to the bills of lading in clause "G" of the charter party: "Freight payable to: Owner's [CP Bermuda] account, seven (7) days after signing/releasing Bills of Lading." (Jadhav Aff. Ex. 2) Thus, the charter party made provision for the possibility that CP Bermuda would authorize the bills of lading by signing or releasing them. The letterheads of CP Ships and CP Tanker show identical telephone and telex numbers in the United States. (Jadhav Aff. Exs. 1 and 13) When Samsung wrote to CP Ships requesting an extension of the statute of limitations, CP Tanker responded in the affirmative. (Jadhav Aff. Exs. 11 and 12) The submissions of the parties support a conclusion of a close relationship between CP ...


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