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Sonito Shipping Co. Ltd. v. Sun United Maritime Ltd.

March 19, 2007

SONITO SHIPPING COMPANY LTD., PLAINTIFF,
v.
SUN UNITED MARITIME LTD., DEFENDANT.



The opinion of the court was delivered by: Haight, Senior United States District Judge

MEMORANDUM OPINION AND ORDER

Plaintiff, asserting a claim for relief within the admiralty and maritime jurisdiction under Rule 9(h), Fed. R. Civ. P., commenced this action in order to invoke the remedy of maritime attachment and garnishment afforded by Rule B of the Supplemental Rules for Certain Admiralty and Maritime Claims.

On the basis of the complaint and accompanying affidavits, the Court issued an ex parte Order for Process of Maritime Attachment. Plaintiff thereafter restrained funds belonging to the defendant in the amount of $392,888.07.

Defendant now moves pursuant to Supplemental Rule E(4)(f) for an order vacating the attachment. For the reasons that follow, the motion is granted.

BACKGROUND

The complaint alleges that on October 26, 2004, plaintiff Sonito Shipping Company Ltd. ("Sonito") as owner, and Sun United Maritime Ltd. ("Sun United") as charterer, entered into a maritime contract of charter party on the New York Produce Exchange form for the use and operation of Sonito's vessel, the M/V LAZOS. Compl. ¶ 4. During performance of the charter party and at the direction of Sun United as charterer, the LAZOS carried a cargo of long grain rice from India to Nigeria. Upon discharge of the cargo at Port Harcourt, Nigeria, "it was discovered that some of the cargo was slack, torn, caked, lost overboard and otherwise not delivered." Compl. ¶ 6. As a result of this damage to and loss of their cargo, the cargo receivers have asserted a claim against Sonito in the amount of $260,000. Compl. ¶ 7. Sonito alleges that Sun United is liable to Sonito for that amount "under the terms and conditions of the October 26, 2004 charter party." Id. Sonito further alleges that Sun United is "in breach of its obligations under the terms of the subject charter by wrongfully refusing to pay the cargo receivers' claim." Compl. ¶ 9.

According to ¶ 14 of the Complaint, the amount of $392,888.07 attached by Sonito was comprised of the following: Sonito's "claim for damage to and loss of cargo of $260,000," ¶ 14(a); interest on that sum in the amount of $32,888.07, ¶ 14(b); and legal fees, arbitrator fees, and costs in an estimated amount of $100,000, which Sonito estimates will be recoverable under governing English law in connection with an arbitration in London, ¶ 14(c).

While not alleged in the complaint, it is common ground that the cargo receivers have commenced an arbitration in London against Sonito for the purpose of asserting their claim for the damage and loss suffered by the cargo. It is further agreed by the parties that no award has yet been made in that arbitration, and that Sonito has made no payment, by award, judgment, settlement, or otherwise, to the cargo receivers.

The relevant terms of the charter party are these:

Clause 60 provides in pertinent part:

THIS CHARTER PARTY SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH ENGLISH LAW AND ANY DISPUTE ARISING OUT OF THIS CHARTER PARTY SHALL BE REFERRED TO ARBITRATION IN LONDON . . .

Clause 8 provides in pertinent part:

Charterers are to load, stow, and in accordance with port/Shippers/Receivers requirements with regard to material required for the protection of the cargo, tally, discharge, lash, secure, unlash, unsecure and trim the cargo at their expense under the supervision of the Captain . . . (emphasis in original).

Clause 36 provides:

CARGO CLAIMS TO BE SETTLED IN ACCORDANCE WITH THE INTER-CLUB NEW YORK PRODUCE EXCHANGE AGREEMENT, AS AMENDED MAY 1984, INCLUDING LATEST AMENDMENTS.

The "Inter-Club New York Produce Exchange Agreement" referenced in Clause 36 is commonly referred to as "the ICA," and I will do so in this Opinion. It is undisputed that the form of the ICA in effect at the times pertinent to this case is the 1996 version.

The ICA provides in ¶ 4:

Apportionment under this Agreement shall only be applied to cargo claims where: . . . (c) the claim has been properly ...


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