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ASOMA CORP. v. M/V SEADANIEL

July 18, 1997

ASOMA CORPORATION, Plaintiff against M/V SEADANIEL, her engines, boilers, tackle, etc., FORTUNE SEA TRANSPORT CORP., OCEAN TRAMPING CO. LTD., CANADIAN FOREST NAVIGATION CO. LTD., Defendants; FORTUNE SEA TRANSPORT CORP., Third-Party Plaintiff -against- MAINLAND SHIPPING LTD., Third-party Defendant


The opinion of the court was delivered by: SOTOMAYOR

 SONIA SOTOMAYOR, U.S.D.J.

 Defendant, Canadian Forest Navigation Co. ("Canadian Forest"), moves this Court to dismiss or stay the proceeding commenced by ASOMA Corporation ("ASOMA") pending arbitration in London. Co-defendant, Fortune Sea Transport Co. ("Fortune Sea"), similarly requests a stay of this action pending arbitration. For the reasons discussed below, I deny both the motion to dismiss and the motion to stay the proceeding pending arbitration.

 FACTUAL BACKGROUND

 On March 17, 1995, Metall Und Tohstoff A.G. ("M.U.R.") on behalf of plaintiff, ASOMA Corporation, entered into a voyage charter party with defendant, Canadian Forest. Under the charter party, approximately 10,000 metric tons of steel were to be shipped aboard the M/V Seadaniel from Ilychevsk, Ukraine to Detroit, Michigan. On October 4, 1995, two bills of lading were issued to M.U.R., as consignee. After the discharge of the cargo was completed on May 31, 1995, ASOMA commenced this action in the Southern District of New York against Canadian Forest and the owner of the M/V Seadaniel, Fortune Sea for alleged cargo damage. *fn1" ASOMA also initiated an action in rem against the M/V Seadaniel.

 DISCUSSION

 I. The Scope of the Charter Party's Arbitration Clause

 There is a strong presumption favoring arbitrability in federal courts, particularly if the clause encompasses and covers "any differences" arising with respect to interpretation of the agreement. See AT&T Technologies, Inc. v Communications Workers of Am., 475 U.S. 643, 650, 89 L. Ed. 2d 648, 106 S. Ct. 1415 (1986); Progressive Casualty Ins. Co. v. C.A. Reaseguradora Nacional de Venezuela, 991 F.2d 42, 47 (2d Cir. 1993). Yet even when the agreement contains a broad arbitration clause, a dispute is not arbitrable if (1) an express provision in the collective bargaining agreement excludes the particular grievance from arbitration, or (2) "forceful evidence of a purpose to exclude the claim from arbitration" is presented. AT&T Techs., 475 U.S. 643 at 650, 89 L. Ed. 2d 648, 106 S. Ct. 1415; see also Woodcrest Nursing Home v. Local 144, 788 F.2d 894, 898 (2d Cir. 1986) (per curium).

 In the present action, Clause 29 of the Charter Party seemingly requires the parties to arbitrate "any dispute" arising out of the contractual agreement. Clause 46 of the Charter Party, however, expressly limits the broad scope of this arbitration provision. Clause 46, in full, provides:

 
U.S. Clause paramount should read as follows:
 
Clause Paramount: Notwithstanding any other provision in this contract, any claims for damage or loss to cargo shall be governed by the Hague-Visby Rules, and any other clause herein repugnant to the Hague-Visby Rules shall be null and void and of no force and effect as respect to cargo claims.
 
Any clause in this contract allocating responsibility or risk with respect to loading, stowing, stevedoring, lashing, securing, dunnaging and delivery shall be deemed to apply only as price terms, and shall not be interpreted to alter in any way the responsibilities of the Owner and the ship as carriers as defined in the Hague Rules as respects to claims for cargo loss and damage. Any arbitration clause in this contract shall not apply to claims for cargo loss or damage but such claims shall be brought in the United State District Court for the Southern District of New York, to which jurisdiction Owners hereby consent. (emphasis added)

 Fortune Sea asserts that Clause 46 does not prevent ASOMA from arbitrating its cargo damage claims because Clause 38 of the Charter Party creates an ambiguity about the applicability of the Hague-Visby Rules, and therefore the arbitration clause to the Charter Party. Clause 38 incorporates a General Clause Paramount which calls for the application of the Hague-Visby Rules only in situations where the country of destination has itself adopted the Hague-Visby Rules. *fn2" Here, the country of destination, the United States of America, has not adopted these Rules. Clause 46, on the other hand, requires the application of the higher limitation incorporated in the Hague-Visby rules to all situations involving cargo damage, even if the destination country has not. Fortune Sea relies on case law which requires that an order to arbitrate "should not be denied unless it may be said with positive assurance that arbitration is not susceptible to interpretation . . . doubts should be resolved in favor of coverage." AT&T Techs., 475 U.S. 643 at 650, 89 L. Ed. 2d 648, 106 S. Ct. 1415. See also Moses H. Cone v. Mercury Constr. Corp., 460 U.S. 1, 103 S. Ct. 927, 74 L. Ed. 2d 765 ...


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