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WATKINS SYNDICATE AT LLOYD'S OF LONDON v. TAMPA AIRLINES

October 1, 2004.

THE WATKINS SYNDICATE AT LLOYD'S OF LONDON, Plaintiff,
v.
TAMPA AIRLINES, S.A., Defendant. TAMPA AIRLINES, S.A., Third-Party Plaintiff, v. DYNAMIC EXPRESS, INC., Third-Party Defendant.



The opinion of the court was delivered by: MICHAEL MUKASEY, Chief Judge, District

OPINION & ORDER

Plaintiff, the Watkins Syndicate of Lloyd's of London ("Watkins"), sues defendant Tampa Airlines under the Warsaw Convention*fn1 for damage to a shipment owned by Watkins's subrogor, Apparel Contractors Association ("Apparel"). Tampa in turn sues third-party defendant Dynamic Express for damages. Watkins moves for partial summary judgment under Fed.R. Civ. P. 56(c), and Tampa cross-moves for summary judgment on the same grounds. For the reasons discussed below, both motions are denied.

  I.

  The facts in this case are as follows, and are undisputed except as otherwise noted. Defendant Tampa shipped 123 cartons of garment cutwork and trim owned by Apparel from Cali, Colombia to Miami, Florida. When the shipment arrived in Miami, Allen Klinger, president and principal owner of Apparel, contracted Dynamic to transport the cargo by truck to Dynamic's warehouse in New Jersey. Klinger had been told that the cargo had been "sitting outside" at the airport. (Klinger Dep. at 9) Because he feared the boxes might have been damaged by the elements while sitting outside, Klinger instructed Dynamic to "make sure everything [was] okay" when shipment was picked up.*fn2 (Klinger Dep. at 9, 33) On September 6, 2002, Dynamic sent one of its drivers, Carlos Hernandez, to pick up the shipment at Miami International Airport.

  At the airport, Hernandez met Benjie Rios, who was responsible for signing over the Apparel shipment from Tampa to Dynamic. (Rios Dep. at 17) Rios was an employee of Worldwide Flight Service,*fn3 a company that breaks down and distributes cargo for Tampa and other airlines. (Rios Dep. at 6) When he saw the shipment, Hernandez noted that the boxes were "swollen up and . . . wet with spots." (Hernandez Dep. at 11) Rios and Hernandez, both native Spanish speakers, conversed in Spanish and agreed that the shipment was damaged. Rios later testified that the boxes looked as if "there was too much weight inside" and that they were "exploding [open] inside" (Rios Dep. at 20-21).*fn4 Hernandez radioed his supervisor Levine to tell him about the damage, and Levine instructed Hernandez "to make the proper notations." (Levine Dep. at 30)

  Rios signed the pickup form under the notation "cargo came with improper package," (Hernandez Dep. Exh. 1), although Rios and Hernandez dispute who wrote the notation itself.*fn5 (Hernandez Dep. at 14; Rios Dep. at 25) Hernandez testified that Rios told him that the notation on the pickup form was "complete," and that Hernandez could not make any exceptions to the shipment "other than what was obvious." (Hernandez Dep. at 24; Levine Dep. at 38)

  After the damage notation was made and Rios had signed the form, Hernandez took the top copy of the pickup form with him and left Rios with the bottom two copies. Rios's copies did not have any notation of damage on them, because the notation had been made only on the top copy, and the pickup order did not have carbon paper between its sheets. Both Hernandez and Rios knew that Hernandez had the only annotated copy of the form. (Hernandez Dep. at 29-30; Rios Dep. at 29-30) Hernandez and Rios agreed that Hernandez needed the notation of damage to show the trucking company he worked for, Dynamic, and that the annotated pickup form was for Dynamic, not for Rios's company, Worldwide. (Hernandez Dep. at 29; Rios Dep. at 25, 29, 32)

  Hernandez drove the damaged cargo to the Dynamic facility in Miami. (Hernandez Dep. at 19) At that point, Dynamic employee Jeffry Levine told Klinger about the poor condition of the boxes, and Klinger instructed Levine to transport the shipment to the Dynamic warehouse in New Jersey so that he could examine it. (Klinger Dep. at 10-11) When Klinger inspected the shipment upon its arrival in New Jersey, he determined it to be a "disaster;" the boxes were "broken open, smelly, [and] wet." (Id. at 13; see also plaintiff's Exh. 6, (survey report describing extensive damage to the shipment)) Klinger and his insurers independently determined that the goods were unsalvageable. Apparel then shipped all 123 boxes to Mexico, where the cutwork and trim was either "given away or put in the garbage." (Klinger Dep. at 53; see also id. at 27)

  On October 1, 2002, Apparel sent Tampa a letter noting the damage and stating that it would hold Tampa fully responsible for its monetary losses. (Furman Decl., Exh. C) In February 2003, plaintiff insurers paid Apparel $96,286.11 as compensation for its losses (plaintiff's Exh. 7), and subsequently brought this action for damages against Tampa.

  II.

  When two parties in a case have cross-moved for summary judgment, both asserting an absence of a genuine issue of material fact, a court must examine each motion separately, and in each instance, draw all inferences against the moving party; the reviewing court need not enter a judgment for either party. Morales v. Quintel Entm't, Inc., 249 F.3d 115, 121 (2d Cir. 2001); Heublein, Inc. v. United States, 996 F.2d 1455, 1461 (2d Cir. 1993); Padberg v. McGrath-McKechnie, 203 F. Supp. 2d 261, 274 (E.D.N.Y. 2002).

  The court has subject matter jurisdiction over this case pursuant to the Warsaw Convention, which provides an exclusive federal remedy for all claims brought against international air carriers for damaged goods. If the Convention applies, it preempts all state law claims arising out of international air transportation. El Al Isr. Airlines, Ltd. v. Tsui Yuan Tseng, 525 U.S. 155, 174-75 (1999); Lokken v. Fed. Express Corp., No. 99-0585, 2000 WL 193121, at *3 (S.D.N.Y. Feb. 16, 2000). Therefore, this court will not consider any supplemental state law claims arising from this incident.

  The Warsaw Convention governs claims arising from "all international transportation of persons, baggage, or goods performed by aircraft for hire." Warsaw Convention, art. 1(1). Article 26 of the Convention provides that receipt of goods without complaint is "prima facie evidence that the same have been delivered in good condition. . . ." Id. art. 26(1). If goods have been damaged in transit, "the person entitled to delivery must complain to the carrier forthwith after the discovery of the damage, and, at the latest, . . . within 14 days from the date on which the baggage or goods have been placed at his disposal." Id. art. 26(2). The Convention further provides that "[e]very complaint must be made in writing upon the document of transportation or by separate notice in writing dispatched within the times aforesaid." Id. art. 26(3). If the above requirements are not followed, "no action shall lie against the carrier, save in the case of fraud on his part." Id. art. 26(4).

  Plaintiff Watkins moves for partial summary judgment on the ground that the notation "cargo came with improper package" on the Apparel shipment pickup form constituted adequate written notice for the purposes of the Warsaw Convention. Plaintiff alternatively claims that if notice was not adequate, defendant's conduct was sufficiently fraudulent to convince plaintiff that sufficient notice had been provided. Defendant Tampa cross-moves for summary ...


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