Opinion
01 Civ. 2824 (RWS)
March 15, 2002
LAWRENCE C. GLYNN, ESQ., NICOLETTI HORNIG CAMPISE SWEENEY, New York, NY, Attorney for Plaintiffs.
CHRISTOPHER H. MANSUY, ESQ., DeORCHIS, WALKER CORSA, New York, NY, Attorney for Defendants.
OPINION
Defendants Olympic Shipping and Management S.A. ("Olympic") and Fednav Ltd. ("Fednav") have moved for summary judgment under Rule 56, Fed.R.Civ.P., to dismiss the complaint of Continental Insurance Company ("Continental") as subrogee of Tradearbed, Inc. and Tradearbed Canada, Inc. (collectively, "Tradearbed"). Continental has cross-moved for leave to file an amended complaint adding as a defendant Fednav International Ltd. ("Fednav International"). For the reasons set forth below, the motion of Fednav is granted and the cross-motion of Continental is denied.
Prior Proceedings
The complaint in this action was filed in this Court on April 3, 2001. By order of the Court filed on September 5, 2001, the action was dismissed for failure to complete service. By letter of September 6, 2001, counsel represented that the vessel owners Olympic Shipping and Management S.A. had been served and requested that the order of dismissal be vacated. The letter was endorsed "So Ordered" on September 10, 2001.
No answers have been filed, and the instant motions were returnable December 19, 2001.
The Facts
The facts are based on the parties' Local Rule 56.1 statements and are not in dispute, except as noted.
Fednav International, which is not a party to this action, issued bills of lading covering the shipment of steel coils from Ghent, Belgium to New Orleans, Louisiana aboard the M/V OLYMPIC MELODY, owned by Olympic. The bills of lading named Tradearbed as consignee.
The steel coils were discharged and delivered from the vessel at New Orleans during the period March 4-11, 2000. Fednav did not act as a common carrier and did not own, operate, manage, charter or control the M/V OLYMPIC MELODY with regard to the voyage which is the subject of the lawsuit. Nor did Fednav act as a bailee or warehouseman of the cargo that is the subject of Continental's complaint or handle the cargo at any time.
The United States Carriage of Goods by Sea Act ("COGSA"), 46 U.S.C. § 1303(6), governs this transaction and required plaintiff to file suit within one year of the date when the goods were delivered. Delivery of the goods at New Orleans took place, at the latest, on March 11, 2000. The one-year statutory period expired March 12, 2001.
According to counsel for Continental, the steel coils were made available for pick-up at Federal Marine Terminals in Burns Harbor, Indiana on April 7, 2000. According to Continental, the coils suffered rust damage, and Continental satisfied the claim of its insured Tradearbed in the amount of $38,690.34 and became subrogated to the claim.
On January 9, 2001, Fednav International extended Continental's time to sue up to and including April 21, 2001 with respect to the claim as to a portion of the cargo subject to a parallel extension from the shipowner and "on the condition that the US District Court at New Orleans shall have exclusive jurisdiction over this claim within the extended time period." By telefax dated January 9, 2001, Fednav International extended the time to sue with regard to another portion of the cargo to April 21, 2001, subject to owners granting a parallel extension and "on the condition that the US District Court at New Orleans shall have exclusive jurisdiction over this claim within the extended time period."
On February 7, 2001, Fednav International extended the time to sue with regard to the remainder of the cargo to June 11, 2001, subject to Continental obtaining a parallel extension from the shipowner and "on the condition that the US District Court at New Orleans shall have exclusive jurisdiction over this claim within the extended time."
On February 8, 2001, Trimar Defense Services, on behalf of Olympic, extended the time to sue with regard to the claims conditioned on suits being filed in New Orleans up to and including March 24.
On February 27, 2001, Trimar Defense Services, on behalf of Olympic, further extended the time to sue up to and including April 4, 2001 on "like terms and conditions as Fednav's extension."
No action has been filed with respect to the claim in the United States District Court for the Eastern District of Louisiana (New Orleans). A Waiver of Service was sent to Olympic on April 24, 2001, which Olympic did not sign nor return. Fednav received and signed a Notice of Waiver of Service on October 5, 2001.
Summary Judgment Is Appropriate
Summary judgment is appropriate "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Fed.R.Civ.P. 56(c). In assessing a summary judgment motion, the court should credit the evidence of the nonmoving party, and draw all reasonable inferences in that party's favor. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986). As the Court in Anderson explained, "at the summary judgment stage the judge's function is not himself to weigh the evidence and determine the truth of the matter but to determine whether there is a genuine issue for trial." Id. at 249. All ambiguities and reasonable inferences must be drawn against the moving party. Matsushita Electric Industrial Co. v. Zenith Radio Corp., 475 U.S. 574, 587-88 (1986).
However, "unsupported allegations do not create a material issue of fact," Weinstock v. Columbia Univ., 224 F.3d 33, 41 (2d Cir. 2000) (citations omitted), and so summary judgment "will not be defeated merely . . . on the basis of conjecture or surmise." Bryant v. Maffucci, 923 F.2d 979, 982 (2d Cir. 1991). Furthermore, Rule 56(e) states that "[s]upporting and opposing affidavits shall be made on personal knowledge . . . and shall show affirmatively that the affiant is competent to testify to the matters stated therein." Thus, "[o]n a motion for summary judgment, an affidavit filed by a person who serves as an attorney for one of the parties and which was not based on personal knowledge violates Rule 56(e)." Torriero v. Olin Corp., 684 F. Supp. 1165, 1169 (2d Cir. 1988). See also Sitts v. United States, 811 F.2d 736, 741-42 (2d Cir. 1987) ("The rule that an attorney's affidavit alone is insufficient to support a motion for summary judgment has its principal applicability when the dispositive facts as to which the moving party contends there is no genuine issue are historical facts relating to the events leading to the lawsuit, for the attorney usually lacks the requisite personal knowledge of these facts.")
The Complaint Against Fednav Is Dismissed
Fednav did not operate, manage, charter, or control the vessel; nor was it a bailee, a warehousemen, or at fault with regard to the cargo. The record indicates Fednav had nothing to do with the performance of the voyage. The issuer of the bills of lading was Fednav International.
There being no privity of contract between Tradearbed and Fednav, the complaint is dismissed. See Jako Marketing Corp. v. M.V. Sea Fan, 557 F. Supp. 1244, 1249 (S.D.N.Y. 1983).
Olympic Has Not Been Served And The September 5 Dismissal Is Reinstated
The September 10, 2001 vacatur of the order of dismissal was based upon a representation that Olympic had been served, based upon the making of a waiver of service. The waiver was not timely returned, service has not been completed, and the action is therefore dismissed as to Olympic.
The Amendment To The Complaint Is Futile And Leave To File Is Denied
It is conceded by Continental that if the cargo discharge date controls, the action is barred by the COGSA one-year statute of limitations. It is also barred by failure to comply with the conditions of the extension of the time to file.
The vessel discharged and delivered the cargo at New Orleans during the period March 4-11, 2000. This action was commenced by filing the complaint on April 3, 2001. On its face, therefore, the complaint was time-barred. 46 U.S.C. § 1303(6) provides:
In any event, the carrier and the ship shall be discharged from all liability in respect to loss and damage unless suit is brought within one (1) year after delivery of the goods or the date when the goods should have been delivered.
Extensions of time in circumstances similar to these constitute contracts between the carriers who extend the time and the cargo owners. See United Fruit Co. v. J.A. Folger Co., 270 F.2d 666, 669 (5th Cir. 1959), cert. denied, 362 U.S. 911, 80 S.Ct. 682, 4 L.Ed.2d 619 (1960); General Elec. Co. v. M/V Gediz, 720 F. Supp. 29, 30 (S.D.N.Y. 1989) ("Contrary to the general rule that statute of limitations provisions cannot be waived, it is well established that under COGSA the statute of limitations period can be waived either orally or in writing."). Consideration for the contract is the benefit to each party of extending the time period in order to reach a settlement. United Fruit, 270 F.2d at 666.
Contractual waivers of COGSA's one-year time limitation are strictly construed. See M/V Gediz, 720 F. Supp. at 30; Volvo v. M/V Atlantic Saga, 534 F. Supp. 647, 648-49 (S.D.N.Y. 1982); Monarch Industrial Corp. v. American Motorist Insurance Co., 276 F. Supp. 972, 979 (S.D.N.Y. 1967). "It is in the interest of all shippers and all carriers that when a steamship company grants an extension of time for suit, in writing, before the running of the statute, specifically limited to a fixed and reasonable time, that the parties be able to rely on the terms of their agreement." United Fruit, 270 F. Supp. at 670. See also, M/V Atlantic Saga, 534 F. Supp. at 649.
The conditions of the extension having not been fulfilled renders the extension without effect and Continental is bound by the COGSA one-year statute of limitations. See Restatement 2d of Contracts § 225 (1979), which provides: § 225. effects of the non-occurrence of a condition
(1) Performance of a duty subject to a condition cannot become due unless the condition occurs or its non-occurrence is excused.
(2) Unless it has been excused, the non-occurrence of a condition discharges the duty when the condition can no longer occur.
(3) Non-occurrence of a condition is not a breach by a party unless he is under a duty that the condition occur.
In Ewig Int'l Marine Corp. v. M/V Federal Schelde, No. 95 Civ. 5602, 1996 WL 389306 (S.D.N.Y. 1996), the Honorable Loretta A. Preska dismissed the complaint under almost identical circumstances as follows:
Extensions of the time to sue under COGSA can be made subject to conditions. . . . Defendants clearly retained the right to invoke the statute of limitations defense if plaintiff failed to comply with the conditions of the extension. By filing the current action in New York, plaintiff failed to comply with the explicit condition requiring that any actions be filed in Chicago.
Id. at *3 (citations omitted).
Continental seeks to avoid such a dismissal by its claim of delivery on April 7, 2000 to a designee of Tradearbed as set forth in the exhibits to its proposed amended complaint, but these facts contradict its initial pleading and alter the terms of the bills of lading which call for discharge, not delivery. Finally, the facts alleged by Continental are not established by an affiant with knowledge.
Amendment of the complaint as proposed would be futile as barred by the statute of limitations.
Conclusion
For the reasons set forth above, the motion of Fednav is granted, the action against Olympic is dismissed for failure to serve, and the cross-motion for leave to serve an amended complaint is denied as futile.
It is so ordered.