Ford Motor Co. v. WALLENIUS LINES, ETC.

• Decision Date: 28 September 1979
• Docket Number: Civ. A. No. 79-464-N.
• Citation: 476 F. Supp. 1362
• Court: U.S. District Court — Eastern District of Virginia
• Parties: FORD MOTOR COMPANY, Plaintiff, v. WALLENIUS LINES, M/V ATLANTIC CINDERELLA, her engines, boilers, etc., Motorships, Inc., Ramsey Scarlett & Co., Inc., Nacirema Operating Co., Inc., GAB Business Services, Inc., Portsmouth Terminals, Inc., Maryland Undercoating Company, Defendants.

476 F. Supp. 1362

FORD MOTOR COMPANY, Plaintiff, v. WALLENIUS LINES, M/V ATLANTIC CINDERELLA, her engines, boilers, etc., Motorships, Inc., Ramsey Scarlett & Co., Inc., Nacirema Operating Co., Inc., GAB Business Services, Inc., Portsmouth Terminals, Inc., Maryland Undercoating Company, Defendants.

Civ. A. No. 79-464-N.

United States District Court, E. D. Virginia, Norfolk Division.

September 28, 1979.

L. B. Cann, III, Hunton & Williams, Richmond, Va., for plaintiff.

Charles F. Tucker, Vandeventer, Black, Meredith & Martin, Norfolk, Va., for Wallenius Lines, Motorships, Inc., Ramsey Scarlett & Co., Inc.

John R. Crumpler, Jr., Seawell, McCoy, Dalton, Hughes, Gore & Timms, Norfolk, Va., for Nacirema Operating Co., Inc.

Frank B. Miller, III, Sands, Anderson, Marks & Miller, Richmond, Va., for GAB Business Services, Inc.

Guilford D. Ware, Crenshaw, Ware & Johnson, Norfolk, Va., for Portsmouth Terminals, Inc.

Allan S. Reynolds, White, Reynolds, Smith & Winters, Norfolk, Va., for Maryland Undercoating Co.

MEMORANDUM OPINION

CLARKE, District Judge.

This matter comes before the Court on defendant GAB Business Services, Inc. (GAB) Motion to Dismiss pursuant to Rule 12(b)(1), Federal Rules of Civil Procedure. GAB contends that the Court has no jurisdiction over GAB, either through its admiralty jurisdiction or under the doctrine of pendent jurisdiction. Ford has countered GAB's contentions with the argument that GAB and Ford were parties to a contract for an essential maritime service — cargo damage inspection — thereby invoking the admiralty jurisdiction of the Court. Ford alternatively argues that even if admiralty jurisdiction is lacking over Ford's claim against GAB, the Court should exercise its pendent jurisdiction because Ford's claim against all defendants in the case, including GAB, arises from a common nucleus of facts that are so intertwined as to logically require adjudication in one lawsuit. The Court has reviewed the briefs submitted, has referred to the authorities cited therein, and will address the jurisdictional question after briefly summarizing the facts of the case that are pertinent to a determination in the matter.

Factual Background

Ford imports Ford Fiesta automobiles, that are manufactured in Saarlious, Germany, into eight ports in the United States, including the Portsmouth Marine Terminal in Portsmouth, Virginia. On arrival in port at Portsmouth, the stevedore removes the cars from the vessel and drives them to their first point of rest in a wharfing area. The vehicles are then inspected for damage and cleared through customs before Ford's consignee takes possession of the Fiestas. The damage and custom inspections are carried out off the vessel at the first point of rest in the wharfing area.

In this case, 585 Fiestas arrived in Portsmouth on Saturday, April 22, 1978, and were off loaded from the vessel by the stevedore, Nacierma Operating Co. GAB, a company which performs damage surveys for Ford, began performance of the survey on Monday, April 24, 1978. GAB was required by its contract with Ford to notify Ford of two events: (1) confirmation of arrival time and the name of the vessel, and (2) completion of the damage survey with a list of vehicles having certain damage greater than $75.00 per vehicle. This notification was to be done by telephone. GAB did not notify Ford of the arrival of the Fiestas on April 22, 1978, and notified Ford by telephone at the end of the business day on April 25, 1978, of the completion of the damage survey.

In the afternoon and evening of April 25, 1978, a northeaster storm formed off the coast of Virginia and North Carolina, with effects of the storm being felt in Portsmouth that day. Ford contends that the early "weather reports had predicted the path and probable severity of the storm." Complaint at ¶ 17. Despite efforts on the morning of April 26, 1978, by the consignee, Maryland Undercoating Company, to move the cars to a point of safety from the rising waters, Ford claims that "all of the 585 Fiestas were contaminated by salt water," with approximately 146 of the vehicles becoming a total loss and with the remaining 439 vehicles requiring repairs. Complaint at ¶ 19.

In an action to recover this alleged loss, Ford Motor Company, a Delaware corporation with its principal place of business in Dearborn, Michigan, has joined as defendants the shipping line, Wallenius Lines, a Swedish corporation with its principal place of business in Stockholm, Sweden; the ship, M/V ATLANTIC CINDERELLA, owned by Wallenius Lines with a home port in Breman, Germany; the general eastern United States agent for Wallenius Lines, Motorships, Inc., a New Jersey corporation; Motorships, Inc.'s Tidewater Virginia representative, Ramsey Scarlett & Co., Inc., a Maryland corporation with its principal place of business in Baltimore, Maryland; Nacierma Operating Co., Inc., the stevedoring company, which is a New York corporation with its principal place of business in New York, New York; the marine surveyor, GAB Business Services, Inc., a Delaware corporation with its principal place of business in New York, New York; Portsmouth Terminals, Inc., a Virginia corporation with its principal place of business in Portsmouth, Virginia; and the consignee, Maryland Undercoating Company, a Maryland corporation with its principal place of business in Baltimore, Maryland. Ford relies upon various jurisdictional grounds of this Court with respect to these defendants, but, in particular, Ford asserts that the doctrine of pendent jurisdiction permits the Court, in the same proceeding, to hear all of the claims against all of these defendants, including GAB, arising out of the foregoing summarized sequence of events. Also, Ford specifically claims admiralty or maritime jurisdiction under 28 U.S.C. § 1333 against defendant GAB.

Admiralty Jurisdiction

Ford asserts two theories of recovery against GAB: one for breach of contract arising from GAB's contractual duty to notify Ford of the vessel's arrival and the completion of the damage survey, and the other for the tort of negligently failing to notify Ford and Ford's consignee of the completion of the survey. Complaint at ¶¶ 44, 45, 46. This Court is of the opinion, however, that it lacks admiralty jurisdiction under either theory of recovery.

Admiralty jurisdiction over maritime torts has traditionally been determined by looking to the situs of the tort, i. e., the place where the tort occurred. See, e. g., Executive Jet Aviation v. City of Cleveland, 409 U.S. 249, 253, 93 S.Ct. 493, 34 L.Ed.2d 454 (1972);¹ Lassiter v. United States Lines, Inc., 370 F.Supp. 427 (E.D.Va.1973); Wright, Miller & Cooper, Federal Practice and Procedure: Jurisdiction § 3676 (1976) (numerous cases cited therein). "If the wrong took place on navigable waters, the action is within the admiralty jurisdiction; if the wrong occurred on land, it is not." Executive Jet Aviation v. City of Cleveland, supra, 409 U.S. at 253, 93 S.Ct. at 497. The tort of which Ford complains, GAB's negligent failure to timely notify of the completion of the survey, occurred on land after the cars had reached the first point of rest, and not on navigable waters. See Complaint at ¶¶ 15, 18, 19, 44, 45, 46. Accordingly, this Court lacks admiralty jurisdiction over the alleged tort.

In its brief opposing GAB's Motion to Dismiss, however, Ford primarily relies on the Court's admiralty jurisdiction over the contract claim. While the Court agrees with plaintiff's assertion that the location of the breach, whether it occurs on land or on sea, is irrelevant to maritime contract jurisdiction, Kossick v. United Fruit Co., 365 U.S. 731, 735, 81 S.Ct. 886, 6 L.Ed.2d 56 (1960), the Court must first look to the nature and subject matter of the contract to determine if admiralty jurisdiction exists in the first instance. Sanderlin v. Old Dominion Stevedoring Corp., 385 F.2d 79 (4th Cir. 1967). The inquiry "is whether the transaction relates to ships and vessels, masters and mariners, as the agents of commerce." Kossick v. United Fruit Co., supra, 365 U.S. at 736, 81 S.Ct. at 890, quoting, 1 Benedict, Admiralty, 131, as currently set forth in 1 Benedict on Admiralty § 183 (7th ed. 1977). Moreover, under this standard, the place of performance is not controlling since contracts which relate to ships in their use as ships or to commerce or transportation in navigable waters are clearly maritime contracts regardless of whether the contract is to be performed on land or sea. Pierside Terminal Operators, Inc. v. M/V Floridian, 423 F.Supp. 962, 967 (E.D.Va.1976). The controlling factor, referred to by the Court in Pierside as a "qualitative prerequisite" to admiralty contract jurisdiction, is whether the contract has a "maritime flavor." Id. at 970. The Court delineated "maritime flavor" as: "Performance of an actual `maritime service' is required for jurisdictional `maritime flavor'." Id. at 968.

Both Ford and GAB rely in their briefs upon the "maritime flavor" test of Pierside Terminal Operators, Inc. v. M/V Floridian, supra. Ford claims that the contract in question had such a "maritime flavor," while GAB contends that it did not. Since a determination of the "maritime flavor" of a contract must be done on a case-by-case basis, the Court has carefully examined the nature of the contract between Ford and GAB, concluding that it lacks the requisite "maritime flavor" to confer admiralty jurisdiction.

The contract in question was one concerning cargo damage inspection before acceptance by the consignee. Performance of the contract took place after the voyage was completed and after the cargo had been removed from the vessel and taken to the first point of rest in the wharfing area. The contract between GAB and Ford had no relation to furthering the transportation of the cargo by the ship and was performed at a time when the ship was not engaged in commerce or navigation, or in the preparation for...