Opinion
No. 99 Civ. 4183 (MBM).
October 23, 2000.
WILLIAM R. BENNETT, III, ESQ. (Attorney for Plaintiff), New York, NY.
STEPHEN H. VENGROW, ESQ. (Attorney for Defendants), New York, NY.
OPINION and ORDER
Plaintiff C.P. USA, a shipper of textiles, sues Nippon Yusen Kaisha ("NYK"), M/V California Mercury, PO Nedlloyd Inc. ("PO"), M/V PO Nedlloyd Tokyo, Shipco Transport, Inc. ("Shipco") and Consolidated Shipping Services L.L.C. ("CSS") to recover for losses allegedly suffered by plaintiff in connection with the shipment of textiles to Dubai, United Arab Emirates ("UAE"). Defendants NYK, PO and Shipco move for summary judgment on the ground that plaintiff's suit is barred by the one-year limitations period contained in the Carriage of Goods by Sea Act, 46 U.S.C. § 1301 et seq. (1994) ("COGSA"). For the reasons set forth below, defendants' motion is denied.
I.
The following facts are not in dispute. On or about May 23, 1997, plaintiff delivered to defendants NYK and Shipco at the port of New York two containers of textile goods for shipment to the port of Dubai, UAE. (Def. Local Rule 56.1 Statement, ¶ 7; Pl. Local Rule 56.1 Reply, ¶ 7) Plaintiff delivered to defendants PO and Shipco at the port of New York on or about May 30, 1997 two additional containers of textile goods for shipment to the port of Dubai, UAE. (Def. Local Rule 56.1 Statement, ¶ 8; Pl. Local Rule 56.1 Reply, ¶ 8) The bills of lading governing these shipments list the port of discharge as "Dubai". (Pl. Mem., Exh. E)
On or about June 24, 1997, the respective defendants discharged plaintiff's shipment to defendant CSS at Jebel Ali Terminal, a terminal managed by the Dubai Port Authority. (Vengrow Decl., Exh. D) CSS then issued cargo arrival notices to the consignee on June 24 and 26, 1997. (Def. Local Rule 56.1 Statement, ¶ 11; Pl. Local Rule 56.1 Reply, ¶ 11) The consignee never picked up the cargo. (Def. Local Rule 56.1 Statement, ¶ 12; Pl. Local Rule 56.1 Reply, ¶ 12) The cargo was then sold at auction on January 25, 1998 by the Dubai Ports Customs Department. (Id.)
Plaintiff filed this suit on June 10, 1999, alleging, inter alia, that the cargo had been discharged at the wrong port. (Compl. ¶¶ 11-12) Plaintiff contends that the cargo should have been delivered to Dubai's Port Rashid Terminal rather than the Jebel Ali Terminal. Defendants respond that delivery at Jebel Ali Terminal satisfied their obligations under the bills of lading. Defendants Shipco, NYK and PO now move for summary judgment on the ground that plaintiff's suit is barred by COGSA's one-year limitation period.
II.
By its terms, COGSA applies only to the period after loading and before discharge of cargo. See Allied Chemical Int'l Corp. v. Companhia de Navegacao Lloyd, 775 F.2d 476, 483 (2d Cir. 1985); 46 U.S.C. § 1311. However, parties may contract to extend COGSA's provisions to govern pre-loading and post-discharge liabilities. See Allied Chemical, 775 F.2d at 483. Here, there is no dispute that plaintiff's alleged loss occurredafter discharge at Jebel Ali Terminal. Thus, COGSA'a one-year limitation period applies to plaintiff's claims only if the parties agreed to extend COGSA's provisions to the period after the cargo had been discharged. The moving defendants argue that COGSA's provisions have been so extended. They cite paragraph 6(1) of the bills of lading, which provides in relevant part:
If and to the extent that the provisions of the Harter Act of the United States of America 1893 [sic] would otherwise be compulsorily applicable to regulate the Carrier's responsibility for the Goods during any period prior to loading on or after discharge from the vessel the Carrier's responsibility shall instead be determined by the provisions of 6(3) below, but if such provisions are found to be invalid such responsibility shall be subject to COGSA.
(Mikkelsen Decl. Sec., Exh. A) Pursuant to this paragraph, in order for COGSA to apply to the period after discharge, the Harter Act must be "compulsorily applicable." The applicability of the Harter Act is therefore a necessary condition to the contractual extension of COGSA to the period after discharge. Although other conditions also must be met — including that the alternative provisions of paragraph 6(3) are invalid — the first question that must be answered is whether the Harter Act would apply to plaintiff's claims.
The Harter Act, 42 U.S.C. § 190 et seq. (1994), governs the responsibilities of carriers after discharge until "proper delivery" of the cargo has been made. The Harter Act itself does not define "proper delivery," but case law has defined it as:
either actual or constructive delivery. Actual delivery consists [of] completely transferring the possession and control of the goods from the vessel to the consignee or his agent. Constructive delivery occurs where the goods are discharged from the ship upon a fit wharf and the consignee receives due and reasonable notice that the goods have been discharged and has a reasonable opportunity to remove the goods or put them under proper care and custody.Wemhoener Pressen v. Ceres Marine Terminals, Inc., 5 F.3d 734, 742 (4th Cir. 1993). Thus, in order to determine whether the Harter Act applies, and consequently whether COGSA's one-year limitation provision would govern plaintiff's claim, I must first determine whether a "proper delivery" of plaintiff's cargo was made.
In this case, because defendants never transferred the cargo to the consignee, only a constructive delivery could have been made. As noted, to constitute a constructive delivery, the goods must be discharged upon a "fit wharf," and the consignee must be given notice as well as an opportunity to inspect the goods. To determine whether a wharf is "fit" for purposes of proper delivery, courts generally look to custom and usage at the port. See, e.g., Philip Morris v. American Shipping Co., Inc., 748 F.2d 563 (11th Cir. 1984). At least implicit in the concept of a "fit wharf," however, is the requirement that the wharf be located in the port or terminal where the goods were supposed to have been delivered. See Levatino Co. v. American President Lines. Ltd., 337 F.2d 729, 729 (2d Cir. 1964) (noting that Harter Act required cargo to be placed on wharf at port of destination)
In this case, the question of whether the cargo was discharged upon a fit wharf cannot be answered without also deciding whether Jebel Ali Terminal was a suitable port of discharge — an issue which remains in dispute. Plaintiff argues that the cargo should have been delivered to Port Rashid. Defendants maintain that delivery to Jebel Ali Terminal was sufficient to meet their obligations under the bills of lading. Both parties have advanced conflicting factual evidence to support their respective arguments.
Summary judgment is appropriate only where no genuine issue of material fact exists. Fed.R.Civ.P. 56(c). The suitability of Jebel Ali Terminal as a port of discharge is a material fact which remains in dispute. Resolution of this dispute is essential to any determination of whether proper delivery was made within the meaning of the Harter Act, and consequently whether the provisions of COGSA — including the one-year limitation provision — apply to plaintiff's claims. Moreover, because defendants' motion focused on other issues relating to COGSA's one-year limitation period, the parties have not had an opportunity to brief fully the suitability of Jebel Ali Terminal as a port of discharge. Summary judgment therefore is inappropriate at this time.
For the reasons set forth above, defendants' motion is denied.