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INDIAN HARBOR INS. CO. v. GLOBAL TRANSPORT SYSTEM

March 20, 2002

INDIAN HARBOR INSURANCE COMPANY, PLAINTIFF,
V.
GLOBAL TRANSPORT SYSTEM, INC., DEFENDANT



The opinion of the court was delivered by: Robert W. Sweet, Judge

OPINION

Sweet, D.J.,

Pursuant to Fed.R.Civ.P. 12(b)(6) and the Federal Arbitration Act, 9 U.S.C. § 1 et seq., defendant, Global Transport System ("Global"), seeks to dismiss the complaint of plaintiff, Indian Harbor Global Insurance Company ("Indian Harbor") on the basis of an arbitration clause in one contract. Global also seeks an order pursuant to 9 U.S.C. § 4 compelling Indian Harbor to arbitrate its disputes with Global.

For the foregoing reasons, the motion will be granted, the complaint dismissed and arbitration compelled.

Parties

___________Indian Harbor is a corporation with its principal place of business in Connecticut.

Global is a corporation with its principal place of business in Puerto Rico.

Facts

__________The following facts are taken from Indian Harbor's complaint and documents referred to therein.

Global first obtained a policy with Indian Harbor in June 1999. The policy, number MM100030275, provided Hull and Machinery insurance for its barge, Barge Global I. The policy went into effect September 3, 1999 and expired on September 3, 2000. It contained a Binding Arbitration Clause that states: "The Company and all Insurers under this policy agree that in the event of any difference arising between the Assured and the Company with reference to this policy, such difference will be referred to three disinterested arbitrators. . . ."

Global was entitled to make changes and additions to the policy with Indian Harbor's approval. It did so by asking its broker, Frenkel & Co. ("Frenkel") to contact Indian Harbor's agent Mariner Management ("Mariner"), who has been succeeded by Castlerock Risk Service, LLC ("Castlerock"). If it approved of the change, Indian Harbor then would issue an endorsement recognizing the change or addition.

On April 16, 2000, Indian Harbor issued an endorsement to the policy to include "port risk" coverage of another barge, the Hopper Barge MST 17 (which ultimately sank). Previously, Frenkel had contacted Mariner requesting such coverage.

The policy was renewed effective September 3, 2000 and terminating on September 3, 2001.

On December 29, 2000, Global sought to amend the policy and obtain a Navigation Endorsement for the Barge MST 17. Castlerock received the request, from Frenkel, at 10:30 a.m. It stated: "With effect from 12/26/00 please amend `MST 17' to navigating basis. Vessels going to Santo Domingo to operate as sand carrying vessel bringing sand from West Coast to East Coast." Frenkel altered Global's request later that day, after the Castlerock office was closed for the holiday weekend, to have the policy effective December 31, 2000. Frenkel did not receive a ...


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