CA Seguros Orinoco v. Naviera Transpapel, CA

• Decision Date: 20 January 1988
• Docket Number: Civ. No. 86-242 HL.
• Citation: 677 F. Supp. 675
• Parties: C.A. SEGUROS ORINOCO, Plaintiff, v. NAVIERA TRANSPAPEL, C.A., Seguros La Seguridad C.A. and the M/V ROSAMILA, her engines, tackle, apparel, furniture and equipment, etc., Defendants.
• Court: U.S. District Court — District of Puerto Rico

677 F. Supp. 675

C.A. SEGUROS ORINOCO, Plaintiff, v. NAVIERA TRANSPAPEL, C.A., Seguros La Seguridad C.A. and the M/V ROSAMILA, her engines, tackle, apparel, furniture and equipment, etc., Defendants.

Civ. No. 86-242 HL.

United States District Court, D. Puerto Rico.

January 20, 1988.

Antonio M. Bird, San Juan, P.R., for plaintiff.

José F. Sárraga, Naviera Transpapel, C.A., Hato Rey, P.R., for defendants.

OPINION AND ORDER

LAFFITTE, District Judge.

On February 20, 1985 codefendant in rem the vessel M/V Rosamila left the Port of San Juan, Puerto Rico bound for the Port of Guaranao, Venezuela. The cargo aboard the vessel included 1,554 bundles of waste cardboard boxes and cuttings, which had been sold to C.A. Venezolana de Pulpa y Papel by Papiro, Inc. Four bills of lading had been issued in San Juan earlier that day by codefendant Naviera Transpapel, C.A., a common carrier and owner and operator of the M/V Rosamila, consigning the cargo to C.A. Venezolana de Pulpa y Papel. The following day, about 23 hours out of port, the crew was forced to abandon ship due to fire. The waste cardboard bundles were destroyed. The consignee, C.A. Venezolana de Pulpa y Papel, was duly reimbursed for the loss by its insurer, plaintiff C.A. Seguros Orinoco, which subrogated to the rights of the insured and instituted the present action against the ship in rem, the carrier ("Naviera Transpapel") and the carrier's insurer, Seguros La Seguridad, C.A.

Two motions to dismiss filed by defendants are pending resolution. Codefendant insurer, La Seguridad, moves for dismissal for plaintiff's failure to comply with the relevant statute of limitations. Codefendants the vessel and the carrier move for dismissal based on the doctrine of forum non conveniens.

STATUTE OF LIMITATIONS

Plaintiff's complaint is exceedingly broad. It contains no statement of the grounds upon which the Court's jurisdiction depends, as required by F.R.C.P. 8(a). Nevertheless, mindful of the court's duty to liberally construe all notice pleadings so as to do substantial justice, we hereby find that admiralty jurisdiction attaches through the Carriage of Goods by Sea Act ("COGSA"), 46 U.S.C. sect. 1300 et seq.

COGSA applies because sect. 1300 provides that:

Every bill of lading or similar document of title which is evidence of a contract for the carriage of goods by sea to or from ports of the United States, in foreign trade, shall have effect subject to the provisions of this chapter.

The complaint does happen to mention the four bills of lading issued by Naviera Transpapel upon receipt of the waste cardboard cargo into Naviera's charge at San Juan, Puerto Rico, the port of embarkation. As Puerto Rico may be considered a port of the United States, COGSA applies to the instant action by the statute's own terms, whether or not it is incorporated in the bills of lading. Commercio Transito Internazionale, Ltd. v. Lykes Bros. Steamship Co., 243 F.2d 683 (2nd Cir.1957).

Sections 1303 and 1304 of COGSA enumerate the responsibilities, liabilities, rights, and immunities of the carrier and ship in the case of loss or damage to cargo, and are applicable in this action. Section 1303(6) sets the following time limitation:

In any event the carrier and the ship shall be discharged from all liability in respect of loss or damage unless suit is brought within one year after delivery of the goods or the date when the goods should have been delivered.

It is undisputed that the Rosamila should have delivered the cargo by February 25, 1985 at the latest. The complaint was filed against the Rosamila and Naviera Transpapel, the vessel and carrier, on February 21, 1986, just within the one year prescription period. On June 3, 1986, more than year after the Rosamila should have debarked, plaintiff amended the complaint to include La Seguridad, the insurer of both the ship and carrier.

Codefendant La Seguridad argues that the claim against it is a direct action under the Puerto Rico Insurance Code, sect. 20.010 and 20.030, 26 L.P.R.A. sects. 2001 and 2003¹ and is, in turn, time barred by the one-year prescription period of COGSA. La Seguridad further argues that the amendment of the complaint does not relate back in time under F.R.C.P. 15(c) to the date of the filing of the original complaint. Plaintiff counters by disputing La Seguridad's characterization of the direct action as arising under COGSA, and refers to sect. 20.030(2) of the direct action statute as proof that its claim is not time-barred.

The parties agree that plaintiff's cause of action against La Seguridad is provided by Puerto Rico's direct action statute. Strictly construed, plaintiff is correct in asserting it is not a cargo claim under COGSA, but is a separate cause of action against the insurer. Ruiz Rodriguez v. Litton Indus. Leasing Corp., 574 F.2d 44, 45 (1st Cir.1978). The direct action statute does not, however, contain a provision for a separate statute of limitations. Not illogically, it has been held that "since both actions, that which is brought against the insured as well as the one which is filed against the insurance company, have the same origin and since both depend on the same evidence, there is no justification to establish different periods of prescription." Ruiz Millan v. Maryland Casualty Co., 101 D.P.R. 249, 251 (1973). The period of limitation of the direct action against defendant La Seguridad is, then, the same one year encountered in the underlying cause of action, sect. 1306 of COGSA.

The case of Rogatz v. Hospital General San Carlos, 89 F.R.D. 298 (D.P.R.1980) is directly analogous to the case at bar. In Rogatz, plaintiff filed an action for personal injuries against the Hospital on July 5, 1979. The injury had occurred on August 14, 1978. Puerto Rico has a one year statute of limitations for personal injury actions. The original complaint was thus timely. On August 23, 1979, more than one year after the accident, an amended complaint was filed adding the Hospital's insurance company as a codefendant under 26 L.P.R.A. sect. 2001. The District Court found, citing Ruiz Millan, that the one year limitation period for the underlying personal injury action applied to the direct action as well, and had run. The filing of the original complaint did not toll the direct action against the insurance company. For the direct action to remain, the amended complaint would have to meet the standards for relation back to the original complaint. See also, Santiago-Rivera v. Royal Ins. Co. of Puerto Rico, 613 F.Supp. 121 (D.C.P.R.1985).

Plaintiff attempts to avoid this framework by invoking sect. 20.030(2) of the Insurance Code. As provided in footnote 1, ante, subsection (2) preserves a plaintiff's right to subrogate to the rights of the insured to recover from the insurer under the policy after securing final judgment against the insured. This subsection contemplates a plaintiff obtaining a judgment for money damages against an insured, but, for whatever reasons, such as the insured's inability to pay combined with an insurance company's refusal to cover the judgment under the policy, or for just mere facility, the plaintiff seeks to collect those money damages from the insurance company. This would be a subrogation action on the policy contract, as opposed to a direct action on the damage-incurring occurrence. Subsection (2) is not part of the direct action proper; it merely preserves a common subrogation action in the face of the most uncommon direct action provided for in subsection (1).² Plaintiff may not use it as a basis for bringing an otherwise time-barred action against an insurance company until after the issuance of a final judgment against an insured. Ramos v. Continental Insurance Company, 493 F.2d 329, 333 (1st Cir.1974).

Plaintiff relies on Barrientos v. Gobierno De La Capital, 97 P.R.R. 539 (1969), cert. denied, 400 U.S. 866, 91 S.Ct. 103, 27 L.Ed.2d 104 (1970) for the proposition that complaints may be amended at any time to include an insurance company as a defendant, even after securing final judgment against an insured. The Barrientos opinion does appear on its facts to allow an amendment adding an insurer as defendant more than a year after the occurrence of the damages. Curiously, it also allows without analysis an action against the insured which was filed more than one year after the occurrence of the damages. After 23 pages of close analysis of various issues, the Barrientos court allowed the late amendment adding the insurance company with this terse pronouncement:

13 With respect to the defense of prescription of American Surety Co., it suffices to refer to sect. 20.030(2) of the Insurance Code, 26 L.P.R.A. sect. 2003, which recognizes plaintiff's right to bring suit against the insurer even after securing final judgment against the insured. This means that in the case at bar the cause of action against American Surety Co. is still on time, although more than ten years have elapsed since the complaint was amended to join it as defendant.

97 P.R.R. at 562.

These two bare sentences coming at the end of a long, at times confusing opinion are not persuasive enough to warrant disregard of the subsequently and contrarily decided cases previously mentioned (Ruiz Millan, Santiago-Rivera, Rogatz).

The Court is therefore duty bound to apply F.R.C.P. 15(c) to determine if the amendment relates back to the original complaint. For a claim included later by amendment to relate back, (1) the claim must arise out of the same occurrence as the claims in the original complaint, (2) the new party must have received such notice of the institution of the action before the limitations period ended that it will not be prejudiced in its defense, and, (3) the new party knew or should have known that, but for a mistake identifying the proper party, the action would have been brought against the new party. F.R.C.P. 15(c); Serrano v. Torres, 764 F.2d 47, 49 (1st Cir.1985).

As in Rogatz,...