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AGFA GEVAERT AG v. TMM LINES LIMITED

August 25, 2005.

AGFA GEVAERT AG, AGFA CORPORATION, and FORTIS INSURANCE COMPANY, N.V., Plaintiffs,
v.
TMM LINES LIMITED, LLC, CP SHIPS, and HAPAG-LLOYD CONTAINER LINE GmbH, Defendants. ALLIANZ MARINE & AVIATION (FRANCE), a/s/o RHOVYL, S.A., Plaintiff, v. LYKES LINES LIMITED, L.L.C. and MAERSK NORFOLK, her engines, tackle, boilers, etc., in rem, Defendants.



The opinion of the court was delivered by: JOHN KEENAN, Senior District Judge

OPINION and ORDER

INTRODUCTION

  Plaintiffs have commenced separate maritime actions against Defendants for negligence and breach of contract arising out of the loss at sea of containers containing photographic materials and polyvinyl chloride. Defendants now seek partial summary judgment limiting their liability to $500 per package. Defendants contend that only 35 packages of photographic materials and 16 packages of polyvinyl chloride were lost. The plaintiffs who filed suit for the loss of the photographic materials cross-move for summary judgment declaring that 567 packages were lost, and that liability should not be limited in any event because the defendants committed an unreasonable "quasi-deviation." The polyvinyl-chloride plaintiffs oppose the defendants' motions but do not cross-move for relief. For the following reasons, all of the motions are denied.

  THE PARTIES

  Plaintiffs Agfa Gevaert AG and Agfa Corporation were the owners and shippers of the lost photographic materials. (Giuliano Decl. ¶ 2). Plaintiff Fortis Insurance Company, N.V. was the lead insurer of these materials. (Agfa Compl. ¶ 4). For the purposes of these motions, these three plaintiffs are collectively referred to as "Agfa." Plaintiff Allianz Marine & Aviation (France) has filed suit as the subrogated underwriter of Rhovyl, S.A. ("Rhovyl"), the owner and shipper of the lost polyvinyl chloride. (Allianz Compl. ¶¶ 2-3). For the purposes of these motions, these two plaintiffs are referred to as "Allianz."

  Defendants TMM Lines Limited, LLC ("TMM") and Lykes Lines Limited, L.L.C. ("Lykes") are subsidiaries of Defendant CP Ships. (Jones Decl. ¶ 1). TMM entered into a bill of lading contract with Agfa concerning the carriage of the photographic materials; Lykes entered a bill of lading contract with Allianz concerning the carriage of the polyvinyl chloride. (TMM Rule 56.1 Stmt., Exhs. A & B). Defendant Hapag-Lloyd Container Line Gmbh ("Hapag") was the time charterer of the M/V Maersk Norfolk ("Norfolk") for the voyage at issue. (Godemann Aff. at 2). Hapag made space available aboard the Norfolk for TMM and Lykes containers pursuant to an Operational Implementing Agreement and Cross-Charter Party with TMM and Lykes. (Id. at 2, Exh. A).

  TMM, CP (defendants in the Agfa action) and Lykes (defendant in the Allianz action) are represented by the same counsel. By Memo-Endorsed Order dated October 5, 2004, the Court consolidated the two actions for the purposes of the TMM, CP and Lykes motion for partial summary judgment. Hapag (defendant in the Agfa action) has other counsel and has filed its own motion for partial summary judgment with essentially the same arguments. Agfa has cross-moved for summary judgment; Allianz has not. FACTUAL BACKGROUND

  On March 3, 2003, at the Port of Rotterdam, Agfa's container of photographic materials and Allianz's container of polyvinyl chloride were placed aboard the Norfolk. The next day, the Norfolk left the Port of Southhampton, its last European port of call, for a transatlantic voyage to the Port of New York. During the journey, the mighty Neptune raised a storm and claimed as booty several of the Norfolk's containers, including Agfa's container of photographic materials and Allianz's container of polyvinyl chloride.

  The Agfa and Allianz bills of lading are essentially identical. Under the column headed "DESCRIPTION OF PACKAGES AND GOODS" in the Agfa bill of lading, the breakdown of the shipment is as follows:
Order 8042217H2: 348 Karton on 13 Euro-Palette 12 Karton on 1 Euro-Palette
Order 7544511H3: 17 Karton on 1 Euro-Palette
Order 8051133B2: 11 Bulk-Palette on 5 Palette
Order 7549536L3: 60 Karton on 4 Palette
Order 7511401D3: 60 Karton on 2 Pallets
Order 7567407I3: 6 Karton
Order 7569453C3: 15 Karton on 1 Euro-Palette 7 Karton on 1 Euro-Palette
  Order 7535091E3: 27 Karton on 1 Euro-Palette (TMM Rule 56.1 Stmt., Exh. A). On the last page of the bill of lading appears the entry: "35 SSC/NVE SHIPPED ON BOARD FREIGHT PREPAID 567 CARTON(S)." (Id.).*fn1 On the Allianz bill of lading, the relevant descriptions of the shipment are "80 BALES ON 16 PALLETS POLYVINYL CHLORIDE FIBER" and "80 UNIT(S)." (Id., Exh. B). Both bills contain the number "1" in the column headed "NO. OF PACKAGES." In both cases, this entry signifies that one container housed the pallets and cartons. Neither Agfa nor Allianz declared the value of their goods on the faces of their respective bills of lading. (Rule 56.1 Stmts. ¶¶ 8, 11).
  The last page of each bill of lading sets out terms and conditions of the carriage in a manner that gives new meaning to the term "fine print." An electron microscope reveals the following relevant language:
5(a)(2). [I]n the event that this Bill of Lading covers shipments to or from the United States of America, then the Carriage of Goods by Sea Act of the United States ("COGSA") shall be compulsorily applicable. . . .
11(a). Goods, including Goods packed in Containers by the Carrier or Merchant, may be carried on deck without notice to the Merchant. Goods, other than livestock, stowed in any covered-in-space, or packed in a Container carrier on deck shall be deemed to be stowed under deck for all purposes including, where applicable, COGSA and the Hague Rules.
18(b). In no event shall the carrier be liable for loss or damage to or in connection with the Goods in an amount exceeding US $2.50 per kilo, or US $500 per Package or per shipping unit where the Goods are not shipped in Packages. If such limitation is inapplicable under the local law in which an action is brought, then the Hague Rules (Unamended) limitation of £100 sterling lawful money of the United Kingdom per package or shipping unit shall apply, or alternatively, if the shipment covered by this Bill of Lading originates in a country where the Hague-Visby Amendments to the Hague Rules are mandatorily applicable, Carriers [sic] liability shall not exceed 2 SDR per kilo or 666.67 SDR per Package or shipping unit whichever the greater.
(TMM Rule 56.1 Stmt., Exhs. A & B). The $500 per package limitation of liability in Section 18(b) is identical to that of the Carriage of Goods by Sea Act ("COGSA") in cases where the shipper has not declared the nature value of the goods in the bill of lading. See 46 U.S.C. App. § 1304(5).

  Defendants TMM and CP Ships seek partial summary judgment limiting their liability for the loss of Agfa's photographic materials to $17,500. They claim that "$500 per Package" limitation specified in Section 18(b) and COGSA applies because Agfa did not declare the value of the materials in the bill of lading. (TMM Br. at 2, 5-6).*fn2 They also claim that Agfa had only 35 "packages" onboard the Norfolk (29 pallets and 6 loose cartons). (Id. at 9). Defendant Hapag moves for the same relief, citing a "Himalaya Clause" in the Agfa-TMM bill of lading. (Hapag Br. at 3-6).*fn3 Defendant Lykes seeks partial summary judgment limiting its liability for the loss of Allianz's polyvinyl chloride to $8000 ($500 × 16 pallets). (TMM Br. at 3, 6).

  Agfa cross-moves for summary judgment declaring that the $500 per package limit is not applicable because the defendants committed an unreasonable "quasi-deviation" by stowing the lost containers on deck instead of below deck. (Agfa Br. at 5-10). Alternatively, if the Court determines that the $500 limitation applies, Agfa moves for summary judgment declaring that the correct number of "packages" is 567, not 35. (Id. at 10-12). Agfa's cross-motion does not seek a judgment with respect to the defendants' liability.

  Allianz opposes Lykes's motion for partial summary judgment without a cross-motion. Allianz contends that if the $500 COGSA limitation applies, there were 80 "packages" onboard the Norfolk, not 16. (Allianz Br. at 3-4). Liability therefore would be $40,000, not $8000. Alternatively, Allianz urges that if the number of packages is found to be 16, then the $2.50 per kilo limitation in Section 18(b) of the bill of lading should apply. (Id. at 5). This calculation would result in liability of $40,007.50. Allianz also reiterates Agfa's ...


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