COM. PETROCHEMICALS, INC. v. S/S Puerto Rico

• Decision Date: 27 July 1978
• Docket Number: Civ. A. No. M-76-1126.
• Parties: COMMONWEALTH PETROCHEMICALS, INC., et al. v. S/S PUERTO RICO, her engines, boilers, tackle, etc., Puerto Rico Maritime Shipping Authority and Leonard Bros. Trucking Co.
• Court: U.S. District Court — District of Maryland

455 F. Supp. 310

COMMONWEALTH PETROCHEMICALS, INC., et al. v. S/S PUERTO RICO, her engines, boilers, tackle, etc., Puerto Rico Maritime Shipping Authority and Leonard Bros. Trucking Co.

Civ. A. No. M-76-1126.

United States District Court, D. Maryland.

July 27, 1978.

COPYRIGHT MATERIAL OMITTED

COPYRIGHT MATERIAL OMITTED

Donald A. Krach and Barrett W. Freedlander, Baltimore, Md., for plaintiffs.

Geoffrey S. Tobias and Kieron F. Quinn and Ober, Grimes & Shriver, Baltimore, Md., for Puerto Rico Maritime Shipping Authority, defendant.

Samuel S. Smalkin, Baltimore, Md., for Leonard Bros. Trucking Co., defendant.

OPINION

JAMES R. MILLER, Jr., District Judge.

In his inimitable way, Chief Judge Brown of the Fifth Circuit, in a related but different context, has stated for me the essence of this case. He said in Wirth Ltd. v. S/S Acadia Forest, 537 F.2d 1272 at 1276 (5th Cir. 1976), reh. en banc den. 541 F.2d 281 (5th Cir. 1976):

"Our principal task in this case is to determine what Congress would have thought about a subject about which it never thought or could have thought and one about which we have never thought nor any other Court has thought. Technology has created a maritime transportation system unlike any which was in existence in 1936 when Congress enacted COGSA." (Footnote omitted).

Presented here is the question of whether a single item of freight, in this case a transformer weighing approximately 44 tons, attached to a "Ro-Ro" "low boy" trailer which was transported by sea aboard the S/S Puerto Rico constitutes a "package" within the meaning of the Carriage of Goods by Sea Act (hereinafter COGSA), 46 U.S.C. § 1301 et seq. It is a question of great importance to both carriers and shippers of freight by sea, but, inexplicably, no reported cases have been found relating directly to the application of the COGSA concept of "package" to the rapidly increasing use of "Ro-Ro" ships in ocean carriage.

"Ro-Ro" is an acronym for the term "Roll on-Roll off" which, in turn, describes an innovation in the maritime transportation industry in which wheeled vehicles move on and off a ship via ramps. Commonly, the trailer portions of tractor-trailer rigs are ramped onto ships which have been designed for or converted to "Ro-Ro" operations. The trailers themselves are then secured to specially designed portions of the ship to await arrival of the ship at the destination port where the trailers are reattached to tractors and ramped off the ship to shore. In such an operation, there is normally no shipboard handling or securing of the freight which is carried on the "Ro-Ro" trailers.

The facts of this case are undisputed. The shipping carrier, Puerto Rico Maritime Shipping Authority (PRMSA), has admitted its liability to the plaintiffs, but claims that the damages are limited to $500.

The plaintiffs, Commonwealth Petrochemicals, Inc. and Fluor Engineers and Constructors, Inc. (hereinafter Commonwealth), were the consignees of two 10,000 KV transformers manufactured by the General Electric Company. Each transformer measured 11 ft. 4 in. in height, 10 ft. 2 in. in length, and 11 ft. 2 in. in width, and weighed a net of 47,700 lb. The freight bill and corrected bill of lading for the two transformers showed that each contained 2,696 cu. ft. and that freight was charged on the basis of cubic feet by PRMSA. As part of the manufacturing process, integral lifting lugs were attached to the four upper corners of each transformer for purposes of its movement and transportation. The manufacturer also mounted and bolted the bottom of each transformer to a heavy angle iron skid. These angle iron skids were approximately 10 ft. long and approximately 11 ft. wide and consisted of angle irons with dimensions of approximately 3" by 3". The skids were so positioned in order to protect the transformers during shipment. Thus fastened to their respective skids, the transformers were transported by two "low boy" trailers to Baltimore from the General Electric plant in Rome, Georgia via Leonard Brothers Trucking Company. In Baltimore, the two "low boy" trailers were towed on board the S/S Puerto Rico, owned and operated by PRMSA, for carriage to their destination, San Juan, Puerto Rico.

In the process of loading the transformers onto the low boy trailers in Rome, Georgia, the transformers were lowered by trolley crane onto the flat bed truck trailers which had a drop center. The angle skids were bolted to the base of the respective trailers. Chains, approximately 1¼" in diameter, were fastened from each of the top corners of the transformers to the sides of the flat bed trailers and tightened by means of ratchets fitted to each chain. Two other links of chain were secured from side to side to the angle iron skids and over and across the flat beds, one being across the front of each transformer and the other being across the back. These chains were also tightened with ratchets. The transformers were unboxed and uncrated except for the porcelain bushings. The porcelain bushings, which are used to connect the power to the transformers, were protected by wooden boxes.

Although the transformers were delivered undamaged to PRMSA in Baltimore, they were observed to be in a damaged condition when the trucking company came on February 3, 1975, to pick up the trailers from the PRMSA lot in San Juan, Puerto Rico. The plaintiffs have abandoned any claim for the slight damage to Transformer No. 888195, but they have shown that Transformer No. 888196 sustained damage to the extent of $13,901.01.

The "low boy" trailers were owned by Leonard Brothers Trucking Company, which rented them to Commonwealth for several weeks. Leonard Brothers, as a common carrier, contracted to deliver the transformers on the trailers from Rome, Georgia to the ship at pier side in Baltimore.

As is customary, PRMSA has a short form and a long form bill of lading. The long form bill of lading commonly is a lengthy document containing in fine print all of the provisions of the tariff of the ocean carrier which has been filed at the Federal Maritime Commission. The short form bill of lading is the working document on which the goods to be shipped are briefly described, the destination stated and the freight charges for that shipment delineated. On the short form bill of lading, few parts, if any, of the long form are restated, and the long form is incorporated by reference.

The short form bill of lading in this case was prepared by the freight forwarder of the plaintiffs. On the short form under the column "No. of Pkgs." was the number "2" and in the corresponding "Description of Pkgs. and Goods" column was the notation "Skids:)", next to which was the word "Transformers." There were, in addition, apparently four boxes of other materials relating to the transformers which are not directly here in issue. On the short form bill of lading in the "No. of Pkgs." column the two skids and the four boxes were totaled and the number "6" inserted in said column. In the "Description of Pkgs. and Goods" column, corresponding to the number "6," were the words "Pcs: _ _ _ Total _ _ _."

On the face of the short form bill of lading, under the aforegoing notations, appear the following words:

"In accordance with the carrier's tariff, carrier's liability shall be limited to no more than $500 per package, piece or customary freight unit when not shipped as package or piece unless a greater value is set forth herein as and unless shipper pays a charge of 2% of declared value in excess of $500 which charge is ."

The long form bill of lading, incorporated by reference in the short form, provides in paragraph 1, among other things, as follows:

"When this Bill of Lading governs, it is subject to the provisions of the Carriage of Goods by Sea Act of the United States, approved April 16, 1936, which are incorporated herein, and nothing herein contained is a surrender by the carrier of any of its rights, immunities or limitations or an increase of any of its responsibilities or liabilities under said Act. If any term of this Bill of Lading be repugnant to said Act to any extent, such term shall be void to that extent but no further.

"The carrier shall be entitled to avail itself of all rights, limitations, exemptions and immunities provided for in said Carriage of Goods by Sea Act, although the contract of carriage evidenced by this Bill of Lading may be for the carriage of goods between ports of the United States." (Emphasis supplied).

Paragraph 22 of the long form reads as follows:

"22. VALUATION. In the event of any loss, damage or delay to or in connection with goods exceeding in actual value $500 per package, lawful money of the United States, or in case of goods not shipped in packages, per customary freight unit, the value of the goods shall be deemed to be $500 per package or per customary freight unit, as the case may be, and the carrier's liability, if any, shall be determined on the basis of a value of $500 per package or per customary freight unit, unless the nature and a higher value shall be declared by the shipper in writing before shipment and inserted in this Bill of Lading.

* * * * * *

"It is agreed that the meaning of the word "package" includes animals, pieces and all articles of any description except goods shipped in bulk.

"In no event shall the carrier be liable for more than the loss or damage actually sustained. The carrier shall not be liable for any consequential or special damage and shall have the option of replacing any lost goods or of replacing or repairing any damaged goods." (Emphasis supplied).

I

The first contention of PRMSA is that the damaged transformer was a "package" under the terms of the contract between the parties and that the liability of PRMSA is limited to $500.

Although COGSA does not apply, as a matter of course, to the ". . . carriage of goods by sea between any port of the United States or its possessions, and any other port of the United...