The opinion of the court was delivered by: Cote, District Judge.
The issue presented here is whether a shipper may recover from its
common carrier or its common carrier's sub-contractor the amount of its
loss beyond that covered by the limitation of liability in its carrier's
airbill. The answer is no.
Plaintiff Nippon Fire & Marine Ins. Co., Ltd. ("Nippon") was the
insurer of two shipments of laptop computers made by Toshiba America
Information Systems, Inc. ("Toshiba"). Defendant Skyway Freight Systems,
Inc. ("Skyway"), an air and ground carrier, agreed to ship the laptops
and then contracted with defendant American International Airways, Inc.
("AIA"), another air carrier, for their transportation. Most of the first
and all of the second shipments were lost and never delivered. Prior to
any formal discovery, plaintiff and both defendants now move for summary
The following facts are undisputed. Toshiba is a manufacturer and
distributor of laptop computers and other electronic equipment. Defendant
Skyway is a domestic air and ground common carrier that entered into a
contract with Toshiba to ship Toshiba's goods. Under this contract,
Skyway agreed to carry a shipment of 50 Toshiba laptops on September 8,
1997, and a second shipment of 157 Toshiba laptops on September 9, 1997.
Both shipments were shipped on "3S" or three-day air terms, requiring
delivery on the third business day following pickup. 3S is Skyway's
slowest method of air service. The laptops were to be shipped from
Toshiba's facilities in Irvine, California and delivered to Toshiba's
consignee, Inacom Corporation, in New Jersey.
The backside of the airbills indicates that the shipments are governed
by Skyway's Air Freight and Express Truck Rules and Regulations Tariff
No. 1. The tariff states that "Skyway's liability shall, in no event,
exceed the declared value of the shipment . . ." The tariff defines
declared value as follows:
Declared Value — Air A shipment will have a
declared value of 50 cents per pound or $50.00,
whichever is higher, unless a higher value is declared
on the Airbill at the time of receipt.
(Emphasis supplied.) The airbills issued by Skyway contain boxes that
permit Toshiba to declare the value of the goods. If it had declared a
value, the fee for shipping the goods would have been increased at a rate
dependent on the value declared. The tariff provides:
An additional charge of 75 cents shall be assessed for
each $100.00 (or fraction thereof) by which the value
declared on the Airbill, at the time of receipt of the
shipment from the shipper, exceeds 50 cents per pound or
$50.00, whichever is higher.
Choosing instead to insure the shipment of the laptops through Nippon,
Toshiba left the boxes for a declared value blank. Toshiba declared a
weight of 600 pounds on the bill of lading for the first shipment and 1,
606 pounds on the bill of lading for the second shipment.
Rather than transport the goods itself, Skyway shipped the goods from
California to Pennsylvania through AIA. AIA issued two airway bills for
the shipments, and "NVD" or no value declared was written in the box
entitled "Declared Value for Carriage" on that bill. Each airway bill
states on its face that the goods are
subject to the conditions of contract on the reverse
hereof, the shipper's attention is drawn to the notice
concerning carrier's limitation of liability. Shipper
may incease such limitation of liability by declaring a
higher value for carriage and by paying a supplemental
charge subject to conditions of contract on reverse side.
(Emphasis supplied.) The reverse side contains the following limitation
of liability provision:
[the] carrier's liability is limited to damages which
occur while the shipment is in the custody of carrier
or its duly authorized agent and shall in no event
exceed (1) 50 ¢ per pound; multiplied by the number
of pounds (or fraction thereof) of each piece(s) of the
shipment which may have been delayed, lost, damaged,
or destroyed (but not less than $50 per shipment), unless
a higher value is declared herein and applicable charges
are paid thereon, plus the amount of any transportation
charges for which the carrier may be liable, or (2) the
amount of any damages actually sustained; whichever is less;
and that carrier's liability excludes all special and consequential
damages for which the shipper has not given the carrier
advance written notice on the airbill of the circumstances
which will result in the occurrence of such damages, as
provided in carrier's Official Freight Tariff Manual.
The AIA tariff manual contains similar limitations.
Skyway delivered both shipments to AIA's facility at the Los Angeles
International Airport in California. Both shipments arrived in
Philadelphia at 8:40 a.m. on Thursday, September 11, 1997 (the third
business day following the September 8, 1997 shipment; the second
business day following the September 9, 1997 shipment), and AIA held them
for Skyway's pick-up at its Philadelphia airport warehouse. Skyway did
not retrieve the shipments in a timely manner, and neither shipment was
delivered on time. With respect to the first shipment, 20 of the 50
laptops, with a value of $51,306, were eventually reported missing by
Skyway. The remaining laptops were delivered late.*fn1 With ...