Sklut Hide and Furs v. Prudential Lines, Inc., Civ. A. No. 80-552.

• Decision Date: 02 April 1982
• Docket Number: Civ. A. No. 80-552.
• Citation: 537 F. Supp. 266,1986 AMC 959
• Parties: SKLUT HIDE AND FURS, a Delaware corporation, Plaintiff, v. PRUDENTIAL LINES, INC., a Delaware corporation, Defendant.
• Court: U.S. District Court — District of Delaware

537 F. Supp. 266

1986 AMC 959

SKLUT HIDE AND FURS, a Delaware corporation, Plaintiff, v. PRUDENTIAL LINES, INC., a Delaware corporation, Defendant.

Civ. A. No. 80-552.

United States District Court, D. Delaware.

April 2, 1982.

Kester I. H. Crosse, Wilmington, Del., for plaintiff.

Thomas Herlihy, III, of Herlihy, Herlihy & Harker, Wilmington, Del., for defendant; Douglas H. Riblet, of Rawle & Henderson, Philadelphia, Pa., of counsel.

STEEL, Senior District Judge.

Plaintiff, Sklut Hide and Furs ("Sklut") has brought this action in admiralty for the loss of cargo carried in ocean transportation from the United States to Italy. Jurisdiction is based upon 28 U.S.C. § 1333. Now before the Court is the motion of the defendant, Prudential Lines, Inc. ("Prudential") for summary judgment pursuant to Fed.R.Civ.P. 56(b).

On March 27, 1980, plaintiff and defendant entered into a contract of carriage, Bill of Lading No. 1001, for the transportation of a container of 400 wet salted cattle hides aboard the SS Lash Atlantico, an oceangoing vessel owned by Prudential. The bill of lading stated that the "port or place of loading" was New York, the "port or place of discharge" was Leghorn, and bore the following legend:

"CLEAN ON BOARD — FREIGHT PREPAID BEYOND CHARGES TO SAN CROCE SULL ARNO PREPAID HOUSE TO HOUSE CONTAINER SERVICE"

Plaintiff paid defendant a total of $1,538.57, which included prepaid freight for house to house container service between New York and San Croce Sull Arno.

In due course the container was loaded on the SS Lash Atlantico and was later discharged at Genoa, Italy.¹ Why the discharge was in Genoa and not Leghorn as required by the bill of lading is not explained. After its arrival in Genoa the container was delivered to an inland carrier for transportation to Leghorn where it was to be forwarded to San Croce Sull Arno. The hides never reached their intended destination because on or about June 2, 1980, the container and its contents were stolen from the inland carrier after their arrival in Leghorn. Aldo Spinnelli was the inland trucker engaged by the defendant to complete the overland portion of the contract of carriage. Plaintiff did not employ him or designate him as his agent or servant in connection with the shipment.

The defendant bases its motion for summary judgment on two provisions in the contract of carriage set forth in the bill of lading. Prudential points to Clause 10 in which, it contends, Sklut agreed that Prudential would not be responsible for any loss or damage to Sklut's cargo which occurred while the cargo was not in the actual physical custody, control or possession of Prudential. Defendant argues that this provision is enforceable under the United States Carriage of Goods by Sea Act, 46 U.S.C. § 1300 et seq. In addition, Prudential argues that Sklut did not provide notice of the loss or claim in writing within three days of its occurrence as required by Clause 19 of the bill of lading.

Clause 10 of the bill of lading provides as follows:

10. TRANSSHIPMENT:

Whenever the carrier or the Master may deem it advisable or in any case where the goods are consigned to a point where the vessel is not expected to discharge, the carrier or Master may, without notice, forward the whole or any part of the goods, before or after loading at the original or any intermediate port of shipment, or at any other place or places, even though outside the scope of the voyage or the route to or beyond the port of discharge or the destination of the goods, by any vessel, vessels or other means of transportation by water, land or air, or by any such means, whether operated by the carrier or by others and whether departing or arriving, or scheduled to depart or arrive before or after the ship expected to be used for transportation of the goods. The carrier, in making any arrangements for transshipment by any means of transportation not operated by it, shall be deemed the forwarding agent of the shipper and consignee without any responsibility whatsoever. The on carriage shall be subject to the terms of the oncarrier's current form of bill of lading or other contract, whether issued or not, even though such terms may include a lower valuation of the goods or lower limitation of liability or otherwise be less favorable to the shipper or consignee than the terms of this bill of lading. Pending or during transshipment, the goods may be stored ashore or afloat at their risk and expense.

When this bill of lading is issued as a through bill of lading, the cargo described shall be considered to be `in transit' from the place of original departure or a point where the transportation begins to the place of final destination, and all arrangements made for land, water or air transportation of said goods before, or after, the described ocean transportation carried out by Prudential Lines, Inc., have been, or will be, made solely as agents for the shipper/consignee and subject to all of the terms and conditions of the originating, connecting or final carrier's bill of lading or other transit document without any responsibility for performance thereunder being assumed by Prudential Lines, Inc. and without enlargement or extension of the responsibility or liability on its part to the goods as defined in this bill of lading. It is also expressly understood and agreed that Prudential Lines, Inc. will not be responsible with respect to said goods while they are not in its actual physical custody, control or possession.

Section 7 of COGSA, 46 U.S.C.A. § 1307, provides:

§ 1307. Agreement as to liability prior to loading or after discharge

Nothing contained in this chapter shall prevent a carrier or a shipper from entering into any agreement, stipulation, condition, reservation, or exemption as to the responsibility and liability of the carrier or the ship for the loss or damage to or in connection with the custody and care and handling of goods prior to the loading on and subsequent to the discharge from the ship on which the goods are carried by sea.

Apr. 16, 1936, c. 229, § 7, 49 Stat. 1212.

Standing alone Section 7 would authorize the exculpatory provisions in Clause 10 of the bill of lading. Section 7 must be read, however, in the light of Section 12 of COGSA, 46 U.S.C.A. § 1311, which provides:

§ 1311. Liabilities before loading and after discharge; effect on other laws

Nothing in this chapter shall be construed as superseding any part of sections 190 to 196 of this title, or of any other law which would be applicable in the absence of this chapter, insofar as they relate to the duties, responsibilities, and liabilities of the ship or carrier prior to the time when the goods are loaded on or after the time they are discharged from the ship.

Apr. 16, 1936, c. 229, § 12, 49 Stat. 1212.

This latter provision makes clear that the terms of Section 7 must yield to the extent it is inconsistent with "any other law relating to the duties, responsibilities and liabilities of the ship after the time when they are discharged from the ship."

COGSA was enacted in 1936. Section 1 of the Harter Act, 46 U.S.C. § 190, has been the law since it was enacted in 1893. It makes null and void and of no effect all words or clauses in a bill of lading which purport to relieve an owner of any vessel transporting property between ports of the United States and foreign ports from liability for loss or damages for failing to make proper delivery of property committed to its charge. 46 U.S.C.A. § 190 reads:

§ 190. Stipulations relieving from liability for negligence

It shall not be lawful for the manager, agent, master, or owner of any vessel transporting merchandise or property from or between ports of the United States and foreign ports to insert in any bill of lading or shipping document any clause, covenant, or agreement whereby it, he, or they shall be relieved from liability for loss or damage arising from negligence, fault, or failure in proper loading, stowage, custody, care, or proper delivery of any and all lawful merchandise or property committed to its or their charge. Any and all words or clauses of such import inserted in bills of lading or shipping receipts shall be null and void and of no effect. Feb. 13, 1893, c. 105, § 1, 27 Stat. 445.

Accordingly, COGSA is without application in this case since it is inconsistent with Section 1 of the Harter Act.

Two decisions, Isthmian Steamship Co. v. California Spray-Chemical Corp., 290 F.2d 486 (1961), on reargument, 300 F.2d 41 (9th Cir. 1962); and Caterpillar Overseas, S. A. v. S. S. Expeditor, 318 F.2d 720 (2d Cir. 1963), are especially relevant to an interpretation of the Harter Act. Although they arise from facts dissimilar to those at bar, they establish principles which make Clause 10 null and void and of no effect insofar as it purports to relieve the defendant from responsibility for the loss to plaintiff's cargo after it was discharged at Genoa and was in transit via Leghorn to San Croce Sull Arno.

In Isthmian Steamship Co. v. California Spray-Chemical Corp., supra, 290 F.2d 486, libelant had shipped a quantity of agricultural chemicals, known as cotton dust, from Houston, Texas to Alexandria, Egypt on the Steel Architect owned by the respondent. On arrival at Alexandria the cargo was discharged into lighters for on-carriage to the quays of the Egyptian Petroleum Storage Company. The lighterage was made necessary by Egyptian customs regulations which required that this commodity be landed only at the "petroleum quays." Because of the depth of its draft, the Steel Architect could not come along side the petroleum quays and further transportation was required. The cargo was put aboard the lighters which left the ship and were moored along side the quays. Before delivery of the cargo the lighter sank at her moorings and the cotton dust was damaged by sea water. Libelant sued in admiralty for damages. The cargo had been shipped under short bills of lading which...