Fireman's Fund Ins. Co. v. Crowley Liner Serv. Inc., CIV. NO. 08-1745(PG)
| Decision Date | 16 August 2011 |
| Docket Number | CIV. NO. 08-1745(PG) |
| Parties | FIREMAN'S FUND INSURANCE COMPANY, as subrogee of Puerto Rico Supplies Co. Inc., Plaintiff, v. CROWLEY LINER SERVICES, INC., ET. AL. Defendants. |
| Court | U.S. District Court — District of Puerto Rico |
Before the Court stands Crowley Liner Services, Inc.'s ("Crowley") motion for summary judgment. The instant action was filed by Fireman's Fund Insurance Company ("FFI") as a subrogee of Puerto Rico Supplies, Co., Inc. ("Puerto Rico Supplies"). FFI advanced negligence, gross negligence, recklessness, breach of contract and bailment claims. FFI also sued pursuant to the Harter Act, 46 U.S.C. §§ 30701-30707,1 the Carmack Amendment, 49 U.S.C. § 14706, and the Carriage of Goods by Sea Act ("COGSA"), 46 U.S.C. § 30701.2 For the reasons set forth below, Crowley's motion is GRANTED IN PART AND DENIED IN PART.
Plaintiff filed the instant complaint on July 8, 2008 against Crowley and Capitol Security Police, Inc. ("Capitol"). (Docket No. 1). Crowley filed its motion for summary judgment on October 18, 2010. (Docket No. 37) FFI filed its response to Crowley's motion on November 19, 2010. (Docket No. 51). Crowley then filed a reply to Plaintiff's response on December 10, 2010, and accompanied that motion with an additional statement of uncontested facts, which was filed on December 13, 2010. (Docket No. 56 and Docket No. 57).
The following factual narrative is derived from facts that are deemed uncontested by the Court because they were included in the motions for summary judgment and statements of fact, as well as oppositions, and were agreed upon or properly supported by the evidence and not genuinely opposed.
Puerto Rico Supplies annually imports approximately 4,000,000 cartons of cigarettes. On or before July 11, 2007, Puerto Rico Supplies Co. Inc., purchased a quantity of cigarettes from Lorillard, Inc., in North Carolina for resale in Puerto Rico. The cigarettes were placed in a shipping container and booked for shipment from the port of Jacksonville, Florida to the port of San Juan. The shipments of cigarettes from Lorillard, Inc., were covered and insured through FFI's Open Marine Cargo Policy for Puerto Rico Supplies effective on and after December 21, 2006.
The transportation of the shipping container was conducted pursuant to a Transportation Service Agreement dated February 1, 2007 between Crowley and Premium Brands. This agreement lists Puerto Rico Supplies Co. Inc., as an affiliate. The container was loaded on a barge and transported to the port of San Juan. Upon arrival at the Crowley yard, the container was to be picked up by a trucker and transported it to a bonded warehouse, where the cigarettes were to await further distribution. When the container arrived, Crowley notified Puerto Rico Supplies that it would be available for pick up on July 17, 2007.On July 18, 2007, a trucker arrived at the Crowley yard to pick up the container but it could not be located. Upon investigation it was discovered that Crowley and Capitol had released the container on July 17, 2007 to an unauthorized trucker.
Some but not all of the cigarettes were later recovered by law enforcement officials investigating the theft. Puerto Rico Supplies submitted a claim to FFI in the amount of $729,946.33 for the value of the unrecovered cigarettes. FFI reimbursed Puerto Rico Supplies Co. Inc., in this amount and Plaintiff initiated this subrogation action against Crowley and Capitol, alleging that they were liable for the damages sustained by Puerto Rico Supplies.
On September 30, 2010, Crowley filed a motion for partial summary judgment. In its motion, Crowley asserted that to the extent that it is liable for the stolen cigarettes, its liability is limited to $75,000.00, the amount of insurance it provided on the shipment based on the Transportation Service Agreement, the bill of lading and the applicable tariff. On October 20, 2010, Capitol filed its own motion for summary judgment, in which it asserts that it is a third party beneficiary of the defenses and limitations of liability afforded to Crowley under the bill of lading, the Transportation Service agreement and the applicable tariff.
Capitol and Crowley signed a contractual agreement for Capitol to provide unarmed and armed guard services at designated locations in Puerto Rico on May 24, 2004. Said contract states that Capitol was an independent contractor and not an agent or employee of Crowley.
A motion for summary judgment is governed by Rule 56 of the Federal Rules of Civil Procedure, which entitles a party to judgment if "the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." FED. R. CIV. P.56(a). "A dispute is genuine if the evidence about the fact is such that a reasonable jury could resolve the point in favor of the nonmoving party." Prescott v. Higgins, 538 F.3d 32, 40 (1st Cir. 2008) (internal citations omitted); Calero-Cerezo v. U.S. Dep't of Justice, 355 F.3d 6, 19 (1st Cir. 2004) (); see also Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248-250 (1986). In order for a disputed fact to be considered material it must have the potential "to affect the outcome of the suit under governing law. Sands v. Ridefilm Corp., 212 F.3d 657, 660-661 (citing Liberty Lobby, Inc., 477 U.S. at 247-248); Prescott, 538 F.3d at 40 (citing Maymi v. P.R. Ports Auth., 515 F.3d 20, 25 (1st Cir. 2008)).
The ethos of summary judgment is to "pierce the pleadings and to assess the proof in order to see whether there is a genuine need for trial." DeNovellis v. Shalala, 124 F.3d 298, 306 (1st Cir. 1997) (). The moving party must demonstrate the absence of a genuine issue as to any outcome-determinative fact on the record. Shalala, 124 F.3d at 306. Upon a showing by the moving party of an absence of a genuine issue of material fact, the burden shifts to the nonmoving party to demonstrate that a trier of fact could reasonably find in his favor. Id. (citing Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986)). The nonmovant may not defeat a "properly focused motion for summary judgment by relying upon mere allegations," but rather through definite and competent evidence. Maldonado-Denis v. Castillo Rodriguez, 23 F.3d 576, 581 (1st Cir. 1994).The nonmovant's burden thus encompasses a showing of "at least one fact issue which is both 'genuine' and 'material'." Garside v. Osco Drug, Inc., 895 F.2d 46, 48 (1st Cir. 1990); see also Suarez v. Pueblo Int'l, 229 F.3d 49, 53 (1st Cir. 2000) (). As a result, the mere existence of "some alleged factual dispute between the parties will not affect an otherwise properly supported motion for summary judgment." Liberty Lobby, Inc., 477 U.S. at 247-248. Similarly, "summary judgment may be appropriate if the nonmoving party rests merely upon conclusory allegations, improbable inferences, and unsupported speculation." Medina-Muñoz v. R.J. Reynolds Tobacco Co., 896 F.2d 5, 8 (1st Cir. 1990).
When considering a motion for summary judgment, the Court must examine the facts in the light most favorable to the nonmoving party and draw all reasonable inferences in its favor in order to conclude whether or not there is sufficient evidence in favor of the nonmovant for a jury to return a verdict in its favor. Rochester Ford Sales, Inc. v. Ford Motor Co., 287 F.3d 32, 38 (1st Cir. 2002). The Court must review the record as a whole and refrain from engaging in an assessment of credibility or weigh the evidence presented. Reeves v. Sanderson Plumbing Products, Inc., 530 U.S. 133, 135 (2000) (internal citations omitted). The burden placed upon the nonmovant is one of production rather than persuasion. In other words, in weighing a nonmovant's opposition to summary judgment the Court should not engage in jury-like functions related to the determination of credibility.
A bill of lading is the basic transportation contract of carriage between a shipper and a carrier. Southern Pacific Transp. Co. v. Commercial Metals Company, 456 U.S. 336 (1982).
COGSA applies when there is a contract for carriage of goods between a foreign port and a port of the United States. Barretto Peat, Inc. v. Luis Ayala Colon Sucrs., Inc., 896 F.2d 656, 659 (1st Cir. 1990). However, shipments between ports of the United States and the Commonwealth of Puerto Rico are not governed by COGSA, but are instead governed by the Harter Act. Federal Ins. Co. v. Transconex, Inc., 430 F.Supp. 290, 293 (D.P.R. 1976). Nonetheless, it has been held that where bills of lading expressly incorporate the terms of the COGSA, the rules of the COGSA will apply. Id. Moreover, tariff provisions are binding on both the carrier and the shipper if they are properly filed with an administrative agency. Commonwealth of Puerto Rico v. Sea-Land Services, Inc., 349 F.Supp. 964, 971 (D.P.R. 1970).
The parties do not dispute that the bill of lading, tariff, and the transportation service agreement govern the relationship between Puerto Rico Supplies and Crowley. Neither do the parties dispute that COGSA was incorporated in the bill of lading and extended beyond the tackle-to-tackle period. The bill of lading explicitly extends COGSA's protections during the time that the goods are in the custody of Crowley once they have been discharged from the ship. (Docket 65, Exhibit 1). The Paramount Clause in the bill of lading also states that COGSA shall apply "... before the goods are loaded on and/or after the goods are discharged from the vessel; and throughout the entire time the goods are...
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