Starr Indemintiy & Liab. Co. v. Transfair N. Am. Int'l Freight Servs., CASE NO. C17-697 RAJ

• Decision Date: 22 August 2018
• Docket Number: CASE NO. C17-697 RAJ
• Court: U.S. District Court — Western District of Washington
• Parties: STARR INDEMINTIY & LIABILITY CO. as subrogee of NAVISTAR, INC., Plaintiff, v. TRANSFAIR NORTH AMERICA INTERNATIONAL FREIGHT SERVICES D/B/A TRANSFREIGHT, Defendant.

STARR INDEMINTIY & LIABILITY CO.as subrogee of NAVISTAR, INC., Plaintiff, v. TRANSFAIR NORTH AMERICA INTERNATIONAL FREIGHTSERVICES D/B/A TRANSFREIGHT, Defendant.

CASE NO. C17-697 RAJ

UNITED STATES DISTRICT COURT WESTERN DISTRICT OF WASHINGTON AT SEATTLE

August 22, 2018

HONORABLE RICHARD A. JONES

ORDER

This matter comes before the Court on Defendant and counterclaimant Transfair North American International Freight Services, LLC d/b/a Transfreight Express Lines' ("Transfreight") Motion for Summary Judgment. Dkt. # 14. Plaintiff opposes, and Transfreight has filed a Reply. Dkt. ## 15, 16. Having considered the submissions of the parties, the relevant portions of the record, and the applicable law, the Court finds that oral argument is unnecessary. For the reasons that follow, Transfreight's Motion for Summary Judgment is GRANTED. Dkt. # 14.

I. BACKGROUND

The parties do not dispute the facts of this case. Transfair North America International Freight Services, LLC and its corporate predecessor provide international ocean transportation and transportation-related services to its customers, including as a non-vessel-operating common carrier ("NVOCC") in international commerce with licensing from the Federal Maritime Commission. Dkt. # 14-2 at p. 4, ¶ 5. As an NVOCC, Transfair North America International Freight Services, LLC books ocean transportation for its customers' cargoes aboard ships owned or operated by steamship companies, in some cases by chartering the ships. Id. at ¶ 6. Transfair North America International Freight Services, LLC now uses the trade name "Transfreight Express Lines." Id. at ¶¶ 7-8.

In early to mid-May 2016, Transfreight received a request from Navistar to arrange the transportation of 700 used tractor units from the Port of Houston, Texas to Hai Phong Port, Vietnam. Id. at ¶ 9. Transfreight Express Lines chartered the ship M/V THORCO ALLIANCE from Thorco Projects ("Thorco") to perform the carriage of 153 of the used tractor units (the "Cargo"). Id. at p. 5, ¶ 10. Transfreight Express Lines issued bill of lading number 93716-06008 for that carriage. Id. at ¶ 11; Dkt. # 14-1 at 12-15.

The M/V THORCO ALLIANCE started its voyage to Vietnam on or about July 8, 2016. Dkt. # 14-2 at p. 5, ¶ 12. On August 15, 2016 the M/V THORCO ALLIANCE experienced a total engine breakdown that required the ship's towing to Japan. Id. at ¶ 13, pp. 9-11. Transfreight Express Lines notified Navistar of the breakdown on that same date. Id. at ¶ 14, pp. 12-20.

Since the time of the booking, Transfreight Express Lines knew from Navistar that the Cargo's delivery in Vietnam had to take place by a certain date to allow the Cargo's entry into that country, for the Cargo's sale there. Id. at ¶ 15. After learning of the breakdown and notifying Navistar of the same, for the next several weeks, Transfreight Express Lines communicated regularly with Thorco and Navistar to arrange for the Cargo's timely delivery to Vietnam. Id. at ¶ 16. In the first instance, Thorco arranged totow the M/V THORCO ALLIANCE, still laden with the Cargo, to Japan. Id. at pp.6-7, ¶ 17. After more than two months of negotiations between Transfreight Express Lines and Thorco and communications between Transfreight Express Lines and Navistar, Transfreight Express Lines arranged for the Cargo's transshipment onto the ship FREDENSBORG, to continue the Cargo's carriage to Vietnam. Id. at p. 7, ¶ 18.

In an October 18, 2016 e-mail, Navistar stated to Transfreight Express Lines: "This email is confirming that we want Transgroup [Transfreight Express Lines] to move forward with the booking of the ship." Dkt. # 14-2 at p. 7, ¶ 19, pp. 21-23. At Navistar's request, Transfreight arranged to change the port of discharge from Haiphong to Ho Chi Minh City. Id. at ¶ 20, pp. 24-26. Transfreight Express Lines issued a revised bill of lading on or about November 2, 2016, again with Navistar as the shipper, which bill of lading was for the Cargo's continued carriage to Vietnam (the "Revised Bill of Lading"). Id. at pp.7-8, ¶ 21; Dkt. # 14-1 at pp. 16-20. The Original Bill of Lading and Revised Bill of Lading contain identical "Terms & Conditions" on their reverse pages. Id. at pp. 12-20. Those Terms & Conditions state in relevant part:

1. Definitions "Carrier" means TRANSFREIGHT EXPRESS

LINES, a division of Transgroup International. "Merchant" includes the shipper, the consignee, the receiver of the goods, the holder of this Bill of Lading, any person having a present or future interest in the goods or any person acting on their behalf.

. . .

14. Route of Carriage: Matters Affecting Performance . . . If at any time the carriage is or is likely to be affected by any hindrance, risk, delay, difficulty or disadvantage of any kind (including the condition of the goods), whenever and however arising (whether or not the carriage has commenced) Carrier may a) without notice to Merchant abandon the carriage of the goods and where reasonably possible place the goods or any part of them at Merchant's disposal at any place which Carrier may deem safe and convenient and the responsibility of Carrier in respect of such goods shall then cease. b) without prejudice to the Carrier's right subsequently to abandon the carriage under a) above, continue the carriage.

In any event the carrier shall be entitled to full freight charges on goods received for carriage and Merchant shall pay any additional costs resulting from the above mentioned circumstances.

15. Freight Freight shall be deemed fully earned on receipt of the goods by Carrier and shall be paid whether or not the cargo was lost or damaged. Merchant shall be liable to Carrier for freight and all other charges regardless of whether the shipment was prepaid or freight collect.

Id. The FREDENSBORG timely delivered the Cargo to Vietnam. Dkt. # 14-2 at p.8, ¶ 22. Transfreight Express Lines sent Navistar an invoice for $252,500, which was for the carriage's freight, plus charges to discharge the Cargo from the M/V THORCO ALLIANCE, to load the Cargo onto the FREDENSBORG, and other terminal-handling and coordination charges. Id. at ¶ 23, pp. 27-28.

On May 4, 2017, Plaintiff Starr Indemnity and Liability Company ("Plaintiff), as subrogee of Navistar, filed suit against Navistar and the M/V THORCO ALLIANCE for recovery of the $252,500 in additional freight charges, which Plaintiff had paid to Navistar under its insurance policy. Dkt. # 1. Although Plaintiff did not cite any particular law or statute, Plaintiff claimed that Transfreight and the M/V THORCO ALLAINCE "were negligent, breached their contractual obligations, and failed to exercise due diligence to render the vessel seaworthy at the commencement of the voyage from Houston, Texas." Id. at p. 3, ¶ 9. Transfreight counterclaimed for a declaratory judgment that it had no obligation to pay the $252,500 sought by Plaintiff's Complaint. Dkt. # 8.

On March 23, 2018, Transfreight filed this Motion for Summary Judgment; Plaintiff opposed, and Transfreight filed a Reply. Dkt. ## 14, 15, 16.

II. LEGAL STANDARD

Summary judgment is appropriate if there is no genuine dispute as to any material fact and the moving party is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(a). The moving party bears the initial burden of demonstrating the absence of agenuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). Where the moving party will have the burden of proof at trial, it must affirmatively demonstrate that no reasonable trier of fact could find other than for the moving party. Soremekun v. Thrifty Payless, Inc., 509 F.3d 978, 984 (9th Cir. 2007). On an issue where the nonmoving party will bear the burden of proof at trial, the moving party can prevail merely by pointing out to the district court that there is an absence of evidence to support the non-moving party's case. Celotex Corp., 477 U.S. at 325. If the moving party meets the initial burden, the opposing party must set forth specific facts showing that there is a genuine issue of fact for trial in order to defeat the motion. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250 (1986). The court must view the evidence in the light most favorable to the nonmoving party and draw all reasonable inferences in that party's favor. Reeves v. Sanderson Plumbing Prods., 530 U.S. 133, 150-51 (2000).

However, the court need not, and will not, "scour the record in search of a genuine issue of triable fact." Keenan v. Allan, 91 F.3d 1275, 1279 (9th Cir. 1996); see also, White v. McDonnel-Douglas Corp., 904 F.2d 456, 458 (8th Cir. 1990) (the court need not "speculate on which portion of the record the nonmoving party relies, nor is it obliged to wade through and search the entire record for some specific facts that might support the nonmoving party's claim"). The opposing party must present significant and probative evidence to support its claim or defense. Intel Corp. v. Hartford Accident & Indem. Co., 952 F.2d 1551, 1558 (9th Cir. 1991). Uncorroborated allegations and "self-serving testimony" will not create a genuine issue of material fact. Villiarimo v. Aloha Island Air, Inc., 281 F.3d 1054, 1061 (9th Cir. 2002); T.W. Elec. Serv. V. Pac Elec. Contractors Ass'n, 809 F. 2d 626, 630 (9th Cir. 1987).

III. DISCUSSION

Transfreight argues that it is entitled to summary judgment because Navistar, for which Plaintiff is subrogee (having paid Navistar for the freight charges through itsinsurance policy), signed two bills of lading that expressly allocated the risk of delay (and any costs arising therefrom) to Navistar, not Transfreight. Dkt. # 14 at 3.

As to Plaintiff's claim under the bill of lading, the Court applies traditional contract law. Federal courts interpret and resolve disputes concerning maritime contracts according to federal law. Starrag v. Maersk, Inc., 486 F.3d 607, 616 (9th Cir. 2007) (citing Norfolk S. Ry. Co. v. Kirby, 543 U.S. 14, 23 (2004)). "Since the bill of lading is a contract of carriage between shipper...