Phx. Lithographing Corp. v. Bind Rite Servs., Inc.
| Decision Date | 24 June 2014 |
| Docket Number | Civil Action No. 12–6960. |
| Citation | 27 F.Supp.3d 636 |
| Parties | PHOENIX LITHOGRAPHING CORP., Plaintiff, v. BIND RITE SERVICES, INC., Defendant. |
| Court | U.S. District Court — Eastern District of Pennsylvania |
Barbara J. Cohan, Philadelphia, PA, for Plaintiff.
Mark D. Turetsky, Miller Turetsky Rule and McLennan, Collegeville, PA, for Defendant.
Plaintiff Phoenix Lithographing Corporation (“Plaintiff”) brings this negligence and breach of bailment action against Bind–Rite Services, Inc. (“Defendant”). Plaintiff's complaint pleads two counts: (1) Negligence and (2) Breach of Bailment. Compl., ECF No. 1. Plaintiff alleges that Defendant negligently failed to protect Plaintiff's property, in Defendant's possession, from Hurricane Sandy, thus causing a significant monetary loss to Plaintiff. Defendant's answer raises several affirmative defenses including the seventh defense, and subject of the motion sub judice, namely, that Plaintiff's failure to protect Plaintiff's property was due to an act of God.1 Answer, ECF No. 7. Thus, this case requires the Court to determine if the alleged damage caused by Hurricane Sandy, in this case, falls within the act of God defense, and, if so, whether Defendant is excused from liability to Plaintiff.
Pending before the Court is Defendant's Motion for Summary Judgment. ECF No. 17. Plaintiff's Reply (ECF No. 18) has been filed and the motion is ripe for disposition. For the reasons that follow, the Court finds that Hurricane Sandy was an act of God and that Defendant is excused from any damages resulting in its inability to complete the contract but, due to a dispute of material fact, not for damages due to the loss of Plaintiff's approximately 560,000 sheets of printed paper.
On October 16, 2012, Plaintiff, a commercial printing company, entered into an agreement with Defendant, a bindery, to create 750,000 booklets for Plaintiff with each booklet containing twenty-six pages. Under the agreement, Plaintiff was to print the sheets and deliver them to Defendant's Bergen County warehouse for binding. Plaintiff was preparing these sheets for a customer of Plaintiff, which Plaintiff alleges is “one of Plaintiff's principal customers.” Pl.'s Resp. 1. On October 26, at 12:30 p.m. and 2:54 p.m., respectively, Plaintiff delivered two shipments containing approximately 560,000 pages to be bound.
On October 29, 2012, Hurricane Sandy made landfall. U.S. Department of Commerce, Service Assessment, Hurricane/Post–Tropical Cyclone Sandy, October 22–29, 2012, page 1, Ex. C–5. The hurricane's landfall caused a tidal surge. On October 30, 2012, the “tidal surge pushed up the Hackensack River, causing rapid flooding of the area.” Def.'s Resp. 2.
Defendant's facilities, it turns out, were located just 1,500 feet from the Hackensack River and 325 feet from the Losen Slote Creek, a tributary of the Hackensack River which also flooded due to the tidal surge. The Federal Emergency Management Agency (“FEMA”) had previously designated Defendant's location as a Special Flood Hazard Area and designated the profile as high-risk for a flood. See Pl.'s Resp., FEMA Report 1, Ex. P–3, ECF No. 18–6.
As a result of the surge, Defendant's facility, a one story brick and cinderblock building, was flooded with “water ris[ing] to a depth of 40 inches,” and the “entire premises” was “inundate[d]” with water. Def.'s Mot. Summ. J., Ex. C–1, Ward Aff. 3, Sept. 26, 2013, ECF No. 17–1. The deluge “completely destroyed Plaintiff's printing project, which had been left by Defendant on pallets on the floor of the facility.” Pl.'s Resp. 2. Plaintiff alleges that, as a result of the torrent, “Plaintiff was required to reprint approximately 560,000 sheets and engage another vendor to finish the project, resulting in a direct loss to plaintiff of more than $180,000.” Pl.'s Resp. 3.
Defendant admits that “other than [that] third shift workers working Monday, the 29th of October, 2012, were sent home early[,] [n]o other preparations were made.” Def.'s Mem. Support Mot. Summ. J. 7 . Defendant claims, however, that:
No other preparations were made as the building, its contents, other assets and business continuity had never been challenged or otherwise meaningfully compromised by a weather event. Defendant was satisfied that its property and property of its customers was secure in a building capable of weathering the approaching storm. The unprecedented and devastating power of the event could not be anticipated.
Def.'s Mem. Support Mot. Summ. J. 7 .
There is no genuine dispute among the parties as to Hurricane Sandy's “monstrous power” and “tremendous size,” or that the hurricane was a “tremendously destructive and unprecedented event.” Def.'s Mem. Support Mot. Summ. J. 5. Plaintiff disputes Defendant's assertion that it could not have prepared for the storm. Pl.'s Resp. 4 (“Several of these ‘uncontested facts,’ however, are vigorously disputed by Plaintiff and fall squarely within the purview of the fact finder at trial”). Plaintiff's assertion, therefore, requires the examination of the events leading up to the tempest.
Plaintiff alleges that as early as October 26, 2012, there were “widespread predictions that ... ‘Hurricane Sandy,’ was moving towards the eastern seaboard and was expected to make landfall in the coming days in or near the State of New Jersey, bringing with it substantial rainfall, sustained high winds, and inland and coastal flooding.” Pl.'s Resp. 1. According to Plaintiff, as early as 4:00 p.m. on October 26, “Bergen County ... officials were anticipating ‘enough damage for a disaster declaration’ and the Governor of New Jersey had ordered reservoirs in northern Bergen County lowered because of the significant danger of flooding.” Pl.'s Resp. 3.
Plaintiff claims that by October 27, 2012, weather forecasters were predicting that “the slow-moving hurricane would merge with a cold weather system ... and strengthen into a ‘super-storm’ that would hit the state of New Jersey” with “rainfall of as much as [eight] inches [that] would cause extensive river flooding.” Pl.'s Resp. 2. On the morning of October 29, 2012, Plaintiff contacted Defendant to inquire as to what impact, if any, the hurricane would have on the project. Plaintiff asserts that Defendant “assured Plaintiff that the storm would likely cause delays of only one or two days in the production of Plaintiff's project.” Later on October 29, at 1:00 p.m., the National Weather Service issued a flood warning for Bergen County.
Plaintiff also directs the court to approximately twenty-six pages of public advisories issued by the National Hurricane Center, several of which discuss Hurricane Sandy's predicted impact on the Garden State. See Pl.'s Resp., Public Advisories Issued by the National Hurricane Center (“Advisories”), Ex. P–1, ECF No. 18–2. Plaintiff also asserts that Defendant was aware of the risk of flooding and had previously decided not to purchase flood insurance “because of the high premiums charged for such insurance” due to Defendant's location in a high-risk area for flooding. Pl.'s Resp. 3 .
Summary judgment is appropriate if there are no genuine disputes of material fact and the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(a). “A motion for summary judgment will not be defeated by ‘the mere existence’ of some disputed facts, but will be denied when there is a genuine issue of material fact.” Am. Eagle Outfitters v. Lyle & Scott Ltd., 584 F.3d 575, 581 (3d Cir.2009) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247–48, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986) ). A fact is “material” if proof of its existence or non-existence might affect the outcome of the litigation, and a dispute is “genuine” if “the evidence is such that a reasonable jury could return a verdict for the nonmoving party.” Anderson, 477 U.S. at 248, 106 S.Ct. 2505.
In undertaking this analysis, the court views the facts in the light most favorable to the non-moving party. “After making all reasonable inferences in the nonmoving party's favor, there is a genuine issue of material fact if a reasonable jury could find for the nonmoving party.” Pignataro v. Port Auth. of N.Y. & N.J., 593 F.3d 265, 268 (3d Cir.2010) (citing Reliance Ins. Co. v. Moessner, 121 F.3d 895, 900 (3d Cir.1997) ); see also Kelly v. Ziolko 734 A.2d 893, 899 (Pa.Super.Ct.1999) (citations omitted). While the moving party bears the initial burden of showing the absence of a genuine issue of material fact, meeting this obligation shifts the burden to the non-moving party who must “set forth specific facts showing that there is a genuine issue for trial.” Anderson, 477 U.S. at 250, 106 S.Ct. 2505.
Defendant, in its memorandum in support of its motion for summary judgment, cites to both Pennsylvania and New Jersey law. Defendant does not tell the Court why it chooses to cite both and makes no attempt to determine which law should govern the underlying action. Plaintiff, for its part, merely wades into Defendant's muddied legal analysis and also makes no attempt to choose the law of either jurisdiction. Though the parties dispute the proper legal outcome, neither claims the result would be different under either Pennsylvania or New Jersey law.
A federal court exercising diversity jurisdiction must apply the choice of law rules of the forum state, which here is Pennsylvania. See Erie R.R. Co. v. Tompkins, 304 U.S. 64, 78, 58 S.Ct. 817, 82 L.Ed. 1188 (1938) ; Garcia v. Plaza Oldsmobile Ltd., 421 F.3d 216, 219 (3d Cir.2005) ; Echols v. Pelullo, 377 F.3d 272, 275 (3d Cir.2004) (citing Klaxon Co. v. Stentor Electric Mfg. Co., 313 U.S. 487, 497, 61 S.Ct. 1020, 85 L.Ed. 1477 (1941) ). Pennsylvania courts apply an interests/contacts approach to choice-of-law issues. Coram Healthcare Corp....
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