Antilles Ins. Co. v. Transconex, Inc., 88-1108
| Decision Date | 03 October 1988 |
| Docket Number | No. 88-1108,88-1108 |
| Citation | 862 F.2d 391 |
| Parties | ANTILLES INSURANCE COMPANY, Plaintiff, Appellee, v. TRANSCONEX, INC., Defendant, Appellant. . Heard |
| Court | U.S. Court of Appeals — First Circuit |
Omar Cancio Martinez with whom Law Offices of Trias, Doval, Munoz, Acevedo & Otero, Hato Rey, P.R., was on brief, for defendant, appellant.
Jose A. Fuentes Agostini with whom Law Offices of Troncoso & Fuentes Agostini, San Juan, P.R., was on brief, for plaintiff, appellee.
Before COFFIN, ALDRICH and BOWNES, Circuit Judges.
This case is another step in a continuing battle between common carriers and shippers over so-called released value rates, whereby shippers incur lesser obligations, on the basis of a lower rate. Cf. Federal Ins. Co. v. Transconex, Inc., 430 F.Supp 290 (D.P.R.1976). In this instance a shipper in Chicago, Illinois, shipped 126 cartons of shoes to a consignee in San Juan, Puerto Rico, defendant Transconex, Inc., a non-vessel operating common carrier, being the freight forwarder and party responsible on the bill of lading. Most of the cartons were delivered to the consignee in good order, but some were delivered, at a later date, in bad order, having been damaged while in a warehouse in Puerto Rico. The consignee, having chosen the released value rate that relieved the carrier of all but a small dollar amount, had insured the goods in transit with plaintiff Antilles Insurance Company. Plaintiff paid consignee the loss and sues defendant therefor. It is conceded that, as a subrogee, plaintiff is entitled to the consignee's right, which it says is to recover the full loss, the $50.00 limitation specified under the bill of lading being, it says, illegal. Defendant contests the illegality. The case was tried on stipulated facts and the court found for plaintiff. 672 F.Supp. 61 (D.P.R.1987). Defendant appeals. We reverse.
Admittedly the case is governed by the Harter Act, 46 U.S.C.App. Sec. 190 et seq.
It shall not be lawful for the manager, agent, master, or owner of any vessel transporting merchandise or property from or between ports of the United States and foreign ports to insert in any bill of lading or shipping document any clause, covenant, or agreement whereby it, he, or they shall be relieved from liability for loss or damage arising from negligence, fault, or failure in proper loading, stowage, custody, care, or proper delivery of any and all lawful merchandise or property committed to its or their charge. Any and all words or clauses of such import inserted in bills of lading or shipping receipts shall be null and void and of no effect.
The district court held it was also covered by the Carriage of Goods by Sea Act (COGSA), 46 U.S.C.App. Secs. 1300-1315, which replaces the Harter Act in some circumstances. See Tapco Nigeria, Ltd. v. M/V Westwind, 702 F.2d 1252, 1255 (5th Cir.1983) (); North River Ins. Co. v. Fed Sea/Fed Pac Line, 647 F.2d 985, 987 (9th Cir.1981) (). It did so by taking judicial notice that all maritime carriers serving Puerto Rico are subject to COGSA. This was error. The bills of lading in the cases the court cited specifically referred to COGSA; defendant's did not.
Defendant contends that by electing to ship under the lower of alternative rates graduated according to value, the shipper estops himself from asserting any liability in excess of the value covered by the rate. Plaintiff's, and the district court's, response is that a standard $50.00 is but a token figure and, in effect, a disclaimer of liability, and that a rate based on a disclaimer is not saved by the availability of a higher rate under which full liability is assumed. The second part of this proposition would be so were the first part correct, but it is not.
In the case at bar defendant offered a rate under which the shipper/consignee would pay for insurance, procured either by the carrier or itself. This, manifestly, was no answer to the Harter Act. The further choice in issue read as follows.
In consideration of the rate charged for carriage being dependent on the value of the goods and being based upon an agreed valuation of not more than $50.00 per shipment, unless a greater value is declared at the time of shipment and an additional charge of one (1%) percent thereof paid, the shipper or owner of the goods agrees that carrier shall not be liable in any event for more than the value so declared, nor unless a greater value is declared, for more than $50.00 or more than the actual value if same is less than $50.00.
The validity of this we left open in Polyplastics, Inc. v. Transconex, Inc., 827 F.2d 859, 863 n. 3 (1st Cir.1987).
Without noting that we had observed that...
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