City of Nome v. Alaska Steamship Company, A-97-69 Civ.

• Decision Date: 08 January 1971
• Docket Number: No. A-97-69 Civ.,A-97-69 Civ.
• Citation: 321 F. Supp. 1063
• Parties: CITY OF NOME, Plaintiff, v. ALASKA STEAMSHIP COMPANY, Defendant.
• Court: U.S. District Court — District of Alaska

321 F. Supp. 1063

CITY OF NOME, Plaintiff, v. ALASKA STEAMSHIP COMPANY, Defendant.

No. A-97-69 Civ.

United States District Court, D. Alaska.

January 8, 1971.

Peter B. Walton and Stephen C. Cowper, of Boyko & Walton, Anchorage, Alaska, for plaintiff.

Arthur D. Talbot, Anchorage, Alaska, M. Bayard Crutcher, of Bogle, Gates, Dobrin, Wakefield & Long, Seattle, Wash., for defendant.

OPINION

PLUMMER, Chief Judge.

This action involves damage to a diesel engine which allegedly occurred while the engine was in the defendant's possession in transit from Illinois to the City of Nome. The defendant, Alaska Steamship Company, received the engine at its dock in Seattle from Northern Pacific Railroad. There is a material issue of fact as to whether a bill of lading was issued at that time and, if so, whether it was issued to the primary rail carrier or the switching line. There is also a dispute as to whether the bill of lading, if issued, was issued before or after the ship sailed.

The engine was delivered to the plaintiff, City of Nome, on August 2, 1967, and this suit was subsequently instituted on June 14, 1969. As an affirmative defense, defendant alleges that this action is barred by the one year limitation of claims period contained in § 3(6) of the Carriage of Goods by Sea Act, 46 U.S. C.A. § 1303(6) (1958),¹ which had been incorporated into defendant's standard bill of lading pursuant to 46 U.S.C.A. § 1312 (1958).²

Plaintiff contends that because the bill of lading was either (1) never issued, or (2) issued to the wrong party, or (3) issued after the ship sailed, it had no notice, actual or constructive, of the limitation period contained in the standard bill of lading.

Defendant urges, however, that for purposes of this motion, actual notice is irrelevant because the standard bill of lading required as a matter of law to be filed with the Federal Maritime Commission hereinafter referred to as the Commission pursuant to 46 U.S.C.A. § 844 (Supp. 1970)³, was binding on both parties regardless of actual notice. The correctness of this latter assertion has been raised here by defendant's motion for summary judgment.

I.

Plaintiff's theory of the case rests on the proposition that in the absence of actual issuance of a bill of lading parties to a maritime shipping agreement are only on constructive notice of those documents on file with the Commission which relate to, or might conceivably have some effect upon, rates, charges and services. As the one year limitation period was procedural and did not relate to the substance of what is commonly understood to be a "tariff," plaintiff argues that it would have to have actual notice of that provision before it would be bound thereby.

The principle that actual notice must be given of all non-rate related contractual provisions is derived from Pacific Steamship Co. v. Cackette, 8 F.2d 259 (9th Cir. 1925), in which the court refused to incorporate a notice of claims period on file with the Commission into a standard form passenger ticket because such provision was not "properly included in or related to a system of rates and charges." 8 F.2d at 261. See also, Aspen Pictures, Inc. v. Oceanic Steamship Co., 148 Cal.App.2d 238, 248, 306 P.2d 933, 939 (1957).

Defendant points out that the cases relied upon by the plaintiff were decided before the Intercoastal Shipping Act, 46 U.S.C.A. §§ 843-848 (1958), as amended 46 U.S.C.A. §§ 843-848 (Supp. 1970), was amended to require water carriers to file standard bills of lading with the Commission.⁴ Act of August 28, 1958, Pub.L. No. 85-810, 72 Stat. 977, amending 46 U.S.C.A. § 844 (1958). Pacific Steamship Co. v. Cackette was, however, cited with approval by the Ninth Circuit in the 1966 case of Port of Tacoma v. S.S. Duval, 364 F.2d 615, 617. In that case the port attempted to enforce a maritime lien for wharfage—despite express provisions of the Maritime Lien Act and the fact that the boat, a charter vessel, sailed under a "no-lien" provision —on the grounds that such a lien was provided for in standard forms filed with the Commission pursuant to 46 U. S.C.A. § 844. The court ignored the 1958 amended language and held, presumably on the authority of Pacific Steamship Co. v. Cackette, that § 844 deals only with "rates, fares and charges for or in connection with transportation." 364 F.2d at 617. Defendant contends that this decision was erroneously based upon the pre-1958 statute and should be disregarded.

II.

Defendant's case hangs upon the scope and applicability of United States Navigation Co., Inc. v. Cunard S.S. Co., 284 U.S. 474, 52 S.Ct. 247, 76 L.Ed. 408 (1931) in which the Supreme Court reasoned that the Shipping Act of 1916⁵ should be construed in light of settled principles under the Interstate Commerce Act absent peculiar circumstances. The actual holding of the Court was considerably narrower and merely ruled that the Shipping Board, like the Interstate Commerce Commission, has primary jurisdiction over issues of fact in disputes arising under the Act.

Although most of the analogous cases arising under the Interstate Commerce Act have involved variations from rates, charges or services on file with the Commission, several cases indicate that bills of lading filed with the Commission have the force of statute even as to procedural provisions, such as limitations on filing of claims. See Hartness v. Iberia & V. R. Co., 297 F. 622 (E.D. La.1924); Lazarus v. New York Central R.R., 271 F. 93, 95 (S.D.N.Y.1921). As a general rule, in land transport cases where no bill of lading is issued the uniform bill on file with the Commission is binding on the parties. See, e.g., Charles J. Webb Sons Co., Inc. v. Central R. Co., 28 F.2d 392 (S.D.N.Y.1928), aff'd 36 F.2d 702 (2d Cir. 1929).

The question for decision, therefore, is whether the Intercoastal Shipping Act, as amended, should be construed in the same fashion as the Interstate Commerce Act to bind the City of Nome to the limitation period contained in the standard bill of lading on file with the Commission in the absence of actual notice.

III.

The purpose of the 1958 amendment to 46 U.S.C.A. § 844 was to simplify billing procedures for carriers in the non-contiguous trade by permitting them to issue a short form bill of lading incorporating the provisions of a standard form on file with the Commission. 3 U.S.Code Cong. & Admin.News, p. 4091 (1958). Initially, the filing was to be permissive, but the wording was changed at the suggestion of the Secretary of Commerce to simplify administration. 3 U.S.Code Cong. & Admin. News, p. 4093 (1958).⁶

It was assumed by Congress that accepted billing procedures in 1958 required the issuance of a long form bill of lading in order to consummate an effective contract of carriage. 3 U.S.Code Cong. & Admin.News pp. 4091-4092 (1958). The short form bill was designed to provide "legal protection equal to that obtainable under the present prior to 1958 system." 3 U.S.Code Cong. & Admin.News, p. 4092 (1958). In order to preserve the notice provided by the long form bill of lading Congress provided that the short form bill had to actually be issued and that the long form had to be available upon request and conspicuously posted on each vessel.⁷ Even with these safeguards Congress, at the suggestion of the Secretary of Commerce, changed the language of the amendment so that actual issuance of the short form is not "conclusive" proof of notice, but is merely "deemed" to give notice of the standard bill.⁸

In enacting the 1958 amendment to 46 U.S.C.A. § 844 Congress expressly stated that the limited relief granted to carriers was not intended to change the basic rights and obligations of the parties to a maritime shipping contract. 3 U.S.Code Cong. & Admin.News, p. 4092 (1958). Under the established precedent of this circuit prior to the amendment, carriers were obliged to give consignees actual notice of all contract provisions other than those relating to rates and services, which by law cannot be varied.⁹ Pacific Steamship Co. v. Cackette, supra. The amendment, therefore, in no way vitiates the duty of the carrier to give actual notice of provisions other than those which relate to rates, fares and charges for or in connection with transportation. Port of Tacoma v. Duval, supra.

Since the one year limitation of actions provision found in the Alaska Steamship standard bill of lading on file with the Federal Maritime Board does not relate to "rates, fares and charges for or in connection with transportation," plain...