Coleman Co., Inc. v. Compagnie Generale Maritime

• Decision Date: 25 October 1995
• Docket Number: No. CV 495-153.,CV 495-153.
• Citation: 903 F. Supp. 45,1996 AMC 757
• Parties: The COLEMAN COMPANY, INC. and Commercial Union Assurance, PLC, Plaintiffs, v. COMPAGNIE GENERALE MARITIME and Norfolk Southern Railway Company, Defendants.
• Court: U.S. District Court — Southern District of Georgia

903 F. Supp. 45

1996 AMC 757

The COLEMAN COMPANY, INC. and Commercial Union Assurance, PLC, Plaintiffs, v. COMPAGNIE GENERALE MARITIME and Norfolk Southern Railway Company, Defendants.

No. CV 495-153.

S.D. of Georgia, Savannah Division.

October 25, 1995.

Jane L. Peeples and Edwin D. Robb, Jr., Savannah, GA, for Plaintiffs.

William E. Dillard, III, Savannah, GA, for Defendant Norfolk.

ORDER

NANGLE, District Judge.

Before the Court is the motion of defendant, Norfolk Southern Railway Company, to compel arbitration and stay proceedings in the above-captioned action pursuant to 9 U.S.C. §§ 3 and 4. For the reasons that follow, the Court will dismiss this action sua sponte for lack of subject matter jurisdiction. Fed.R.Civ.P. 12(h)(3).

BACKGROUND

The following facts are taken from plaintiffs' Complaint. In June of 1994, plaintiff, The Coleman Company, Inc. ("Coleman"), sold 169 cartons of camping equipment, coolers and jugs to a firm on the island of New Caledonia. In order to get the goods to New Caledonia, Coleman entered into a through contract of carriage with defendant, Compagnie Generale Maritime ("CGM"), in which CGM agreed to transport the goods from Coleman's place of business in Wichita, Kansas, to Noumea, New Caledonia. CGM, in turn, contracted with defendant, Norfolk Southern Railway Company ("Norfolk Southern"), to carry the goods by rail from Wichita, Kansas to Savannah, Georgia. CGM then planned to transport the goods by sea from the port of Savannah to New Caledonia on its ocean going container vessel, THE M/V RIMBAUD.

Pursuant to this arrangement, Coleman delivered the goods to CGM's agents in Wichita, Kansas on June 27, 1994. CGM's agents thereafter transferred the goods, in good order and condition, to Norfolk Southern for rail transportation to Savannah, Georgia. While in the custody of Norfolk Southern, however, the goods sustained water damage and consequently were not transported to Savannah for shipment to New Caledonia. The water damage to Coleman's goods totalled $10,811.85.

Plaintiff, Commercial Union Assurance, PLC ("CUA"), was the cargo underwriter for Coleman's goods. Accordingly, CUA paid Coleman for the loss it suffered as a result of the water damage to its goods. CUA thus brings this suit as the subrogee to Coleman's interests in the goods.

Plaintiffs' Complaint is captioned "Complaint in Admiralty," and they allege therein that this action involves admiralty and maritime claims within the meaning of Rule 9(h) of the Federal Rules of Civil Procedure. The claims asserted by plaintiffs are as follows: (1) that CGM breached its contract of carriage by failing to deliver Coleman's goods; (2) that Norfolk Southern, as bailee of Coleman's goods, was negligent in failing to take proper care of the goods; and (3) that Norfolk Southern breached its contract of carriage for which CUA is entitled to recovery. Based upon these claims, plaintiffs seek the arrest of THE M/V RIMBAUD so that interlocutory judgments can be asserted against the vessel and entry of judgment against the defendants for all amounts owing, including interest and costs.

DISCUSSION

Admiralty jurisdiction is conferred upon district courts by 28 U.S.C. § 1333(1), which provides that "the district courts shall have original jurisdiction ... of ... any civil case of admiralty or maritime jurisdiction." Plaintiffs' Complaint, construed liberally, sets forth breach of contract claims against CGM and Norfolk Southern, and a tort claim against Norfolk Southern. The question, then, is whether these claims will sustain the Court's admiralty jurisdiction under section 1133(1).

1. Breach of Contract

It has long been the rule that a breach of contract action will not support admiralty jurisdiction unless the underlying contract is wholly maritime in nature. Rea v. the Eclipse, 135 U.S. 599, 608, 10 S.Ct. 873, 876, 34 L.Ed. 269 (1890); Kuehne & Nagel (AG & CO) v. Geosource, Inc., 874 F.2d 283, 290 (5th Cir.1989); Atlantic Mut. Ins. Co. v. Balfour Maclaine Intern. Ltd., 968 F.2d 196, 199 (2nd Cir.1992). There are, however, two exceptions to this general rule. The first is that, "if the character of a contract is primarily maritime and the non-maritime aspects are merely incidental, admiralty jurisdiction may still be invoked." Kuehne & Nagel, 874 F.2d at 290. The second is that, "if a contract is `mixed' — having maritime and non-maritime aspects — maritime jurisdiction exists if the court can enforce the maritime obligations separately without prejudice to the rest." Id.

A contract to transport goods over both sea and land is generally not considered to be wholly maritime in nature. See e.g., Kuehne & Nagel, 874 F.2d at 290 (citing Gilmore & C. Black, The Law of Admiralty § 1-10 (1975)); Berkshire Fashions, Inc. v. M.V. Hakusan II, 954 F.2d 874, 881 (3rd Cir.1992). The contract of carriage between Coleman and CGM was not, therefore, purely maritime in nature because it contemplated that Coleman's goods would be transported by rail (i.e. over land) from Wichita, Kansas to Savannah, Georgia, before being placed into maritime commerce. See Complaint ¶¶ 7 and 8.

The substantial distance between Wichita, Kansas and Savannah, Georgia, moreover, renders the first exception to the general rule inapplicable. Clearly, the land-based aspects of the contract were far more than merely "incidental" to the maritime services to be provided under the...