Yang Ming Marine Transp. Corp. v. Intermodal Cartage Co. Inc

• Decision Date: 16 February 2010
• Docket Number: No. 2:08-cv-2202-DKV.,2:08-cv-2202-DKV.
• Citation: 685 F.Supp.2d 771
• Parties: YANG MING MARINE TRANSPORT CORPORATION, Plaintiff, v. INTERMODAL CARTAGE CO., INC. and Great West Casualty Co., Inc., Defendants.
• Court: U.S. District Court — Western District of Tennessee

685 F.Supp.2d 771

YANG MING MARINE TRANSPORT CORPORATION, Plaintiff,

v.INTERMODAL CARTAGE CO., INC. and Great West Casualty Co., Inc., Defendants.

No. 2:08-cv-2202-DKV.

United States District Court,

W.D. Tennessee,

Western Division.

Decided: Feb. 16, 2010.

James R. Newsom, III, Kannon C. Conway, Harris Shelton Hanover Walsh PLLC. Memphis, TN, James D. Wilson Harris Shelton Dunlap Cobb & Ryder Memphis, TN, for Plaintiff.

Carl Wyatt, Thomas E. Clary, III Glassman Edwards Wade & Wyatt, P.C., Memphis, TN, for Defendants.

ORDER ON CROSS MOTIONS FOR PARTIAL SUMMARY JUDGMENT

DIANE K. VESCOVO, United States

Magistrate Judge.

This is a breach of contract and declaratory judgment action in which plaintiff Yang Ming Marine Transport Corporation ("Yang Ming"), seeks reimbursement from the defendant, Intermodal Cartage Co., Inc. ("Intermodal"), for attorney fees and costs which Yang Ming incurred defending a wrongful death action which was dismissed, Vicki Miller v. Nippon Carbon Co., Ltd., et al, No. 05-cv-2413 (W.D.Tenn). Yang Ming also seeks the amount of attorney fees and costs associated with bringing this action to enforce Intermodal's duty to defend. Before the court are the parties' cross motions for summary judgment filed August 31, 2009. Specifically, Yang Ming claims that under the terms of the Uniform Intermodal Interchange and Facilities Access Agreement ("UIIA"), as well as under the terms of an insurance policy between Intermodal and Great West Casualty Co., Inc., ¹ Intermodal was obligated to defend Yang Ming in the Miller action and failed to do so. (Comp. ¶¶ 13, 20-22.) In opposition, Intermodal claims that the facts underlying the Miller action did not cause a duty to defend and indemnify Yang Ming to arise under the terms of the UIIA or the insurance policy. (Answ. ¶¶ 17, 18, 36.) The parties have consented to having all proceedings in this case conducted by the United States Magistrate Judge, including entry of judgment, pursuant to 28 U.S.C. § 636(c). For the following reasons, the court grants Yang Ming's motion for summary judgment and denies Intermodal's motion for summary judgment.

I. UNDISPUTED FACTS

The Miller action arose out of a shipment of a container owned by Yang Ming. For purposes of the cross motions for summary judgment, the court finds the following facts undisputed.

In 2004, Mitsubishi Logistics Corporation ("Mitsubishi Logistics") contracted with Yang Ming, a corporation organized under the laws of Taiwan, which is in the business of marine freight transport, to ship six loaded containers loaded with electrodes manufactured by Nippon Carbon Co., Ltd. ("Nippon") in Japan to Memphis Tennessee. (Doc. 28-1, PL's Stat, of Mat. Facts ¶ 8; Doc. 42-2, Def.'s Resp. to PL's Stat, of Mat. Facts ¶ 8.) To facilitate the shipment, Yang Ming provided empty containers, to which Yang Ming held beneficial title, to be loaded with the electrodes in Japan and then to be transported to the United States where they were to be unloaded and then returned to Yang Ming. (PL's Stat, of Mat. Facts ¶ 8; Def.'s Resp. to PL's Stat, of Mat. Facts ¶ 8.) One of the six containers that Yang Ming provided was container number YMLU485206-1 ("the container"). (PL's Stat, of Mat. Facts ¶8; Def.'s Resp. to PL's Stat, of Mat. Facts ¶ 8.)

In connection with the shipment, Yang Ming issued Non-Negotiable Sea Waybill YMLUW260451242 ("the Sea Waybill") listing Yang Ming as "carrier" and Mitsubishi Logistics America Corporation ("MLAC") as the "consignee."² (PL's Stat, of Mat. Facts ¶¶ 8-9; Def.'s Resp. to P;'s Stat, of Mat. Facts ¶¶ 8-9.) The Sea Waybill indicated that Yang Ming as carrier would carry the container and its contents from "the place of receipt" to "the place of delivery, Memphis, TN CY." (PL's Stat, of Mat. Facts ¶ 9; Def.'s Resp. to PL's Stat, of Mat. Facts ¶9.) The term "CY" is a standard shipping term which means that the shipper has delivered the cargo to the "container yard" designated by the ocean carrier at the location indicated. (PL's Stat, of Mat. Facts ¶ 9; Def.'s Resp. to PL's Stat, of Mat. Facts ¶ 9.) The notation "CY" as it relates to the place of delivery is also a standard shipping term which means that the carrier will deliver the cargo to the bill of lading consignee or its nominated receiver at the container yard. (PL's Stat, of Mat. Facts ¶ 9; Def.'s Resp. to PL's Stat, of Mat. Facts ¶ 9.) In this case, according to the Sea Waybill, the containers were to be picked up at Nagoya, Japan, and delivered to the Burlington Northern container yard in Memphis, Tennessee. (PL's Stat, of Mat. Facts ¶9; Def.'s Resp. to PL's Stat, of Mat. Facts ¶9.)

Mitsubishi Logistics packed and sealed the containers delivering them into Yang Ming's possession at the Nagoya, Japan container yard. (PL's Stat, of Mat. Facts ¶ 10; Def.'s Resp. to PL's Stat, of Mat. Facts ¶ 10.) The containers were then loaded onto the ocean freighter "Newport Bridge," and shipped from the container yard in Nagoya, Japan to Long Beach, California. (PL's Stat, of Mat. Facts ¶ 11; Def.'s Resp. to PL's Stat, of Mat. Facts ¶11.) After arriving in Long Beach, the container was then shipped via Burlington Northern railways to the Burlington North Santa Fe ("Burlington Northern") container yard in Memphis, Tennessee. (PL's Stat, of Mat. Facts ¶ 11; Def.'s Resp. to PL's Stat, of Mat. Facts ¶ 11.) Upon arrival at the Burlington Northern container yard in Memphis, the Sea Waybill indicates that the delivery status of the container was "Micro Bridge Ramp Service (IPI)." (PL's Stat, of Mat. Facts ¶11; Def.'s Resp. to PL's Stat, of Mat. Facts ¶11.) "IPI" means "Inland Point Intermodal." (PL's Stat, of Mat. Facts ¶ 11; Def.'s Resp. to PL's Stat, of Mat. Facts ¶11.) No damage was found to the container during an inspection conducted by Burlington Northern upon the container's arrival at the container yard. (PL's Stat, of Mat. Facts ¶ 17; Def.'s Resp. to PL's Stat, of Mat. Facts ¶ 17.)

On June 7, 2004, MLAC issued a Drayage Request to Intermodal asking Intermodal to handle the moving of the container from the Burlington Northern container yard in Memphis to a warehouse operated by Global Material Services ("Global") located on President's Island in Memphis, Tennessee. (Doc. 26-3, Def.'s Stat, of Mat. Facts ¶ 1; Doc. 41-2, PL's Resp. to Stat, of Mat. Facts ¶ 1.) The Drayage Request instructed Intermodal to deliver the container to the Global warehouse to be unloaded, after which Intermodal was to pick up the container and return it to the Burlington Northern container yard with freight prepaid by MLAC. (PL's Stat, of Mat. Facts ¶ 15; Def.'s Resp. to PL's Stat, of Mat. Facts ¶15.) To effectuate the exchange from MLAC to Intermodal, Yang Ming issued a Cargo Release on June 9, 2004, which authorized a local cartage company, in this case, Intermodal, to transport the container by truck to the site where it was to be unloaded and to then return the container to the Burlington Northern container yard. (PL's Stat, of Mat. Facts ¶ 16; Def.'s Resp. to PL's Stat, of Mat. Facts ¶ 16.)

Intermodal received the container on June 9, 2004, at the Burlington Northern container yard, with seal number 400208 intact. (Def.'s Stat, of Mat. Facts ¶6; PL's Resp. to Stat, of Mat. Facts ¶ 6.) No damage was found relative to the container in question. (Def.'s Stat, of Mat. Facts ¶ 6; PL's Resp. to Stat, of Mat. Facts ¶ 6.) Accordingly, after inspection of the container, Burlington Northern issued an "Outage Interchange Receipt" to Intermodal. (PL's Stat, of Mat. Facts ¶ 17; Def.'s Resp. to PL's Stat, of Mat. Facts ¶ 17.) This receipt indicated that the "unit cannot return empty w/out waybill." (PL's Stat, of Mat. Facts ¶ 20; Def.'s Resp. to PL's Stat, of Mat. Facts ¶20.) The Outage Interchange Receipt was an "equipment interchange receipt" as defined by the UIIA. (PL's Stat, of Mat. Facts ¶21; Def.'s Resp. to PL's Stat, of Mat. Facts ¶21.)

Intermodal delivered the container to Global that same day in good order. (Def.'s Stat, of Mat. Facts ¶ 7; PL's Resp. to Stat, of Mat. Facts ¶ 7.) The next day, June 10, 2004, Larry Miller, an employee of Global, suffered fatal injuries when he was unloading electrodes from Yang Ming's container. (Def.'s Stat, of Mat. Facts ¶14; PL's Resp. to Stat, of Mat. Facts ¶ 14.) Intermodal was not in actual physical possession of the container at the time of the incident which led to Miller's death. (Def.'s Stat, of Mat. Facts ¶8; PL's Resp. to Stat, of Mat. Facts ¶ 8.) At no time did Intermodal ever break the container's seal or check the contents of the container. (Def.'s Stat, of Mat. Facts ¶ 10; PL's Resp. to Stat, of Mat. Facts ¶ 10.) Intermodal played no role in loading or unloading the container or securing its cargo, and the shipping documents together reflect that there was no problem, defect, or damage to the container during the period of time that Intermodal possessed the container. (Def.'s Stat, of Mat. Facts ¶¶ 11-14; PL's Resp. to Stat, of Mat. Facts ¶¶ 11-14.)

On June 18, 2004, Intermodal picked up the empty container and returned it to the Burlington Northern container yard. (PL's Stat, of Mat. Facts ¶ 24; Def.'s Resp. to PL's Stat, of Mat. Facts ¶ 24.) Upon receipt of the container, Burlington Northern issued an "Ingate Interchange Receipt" to Intermodal. (PL's Stat, of Mat. Facts ¶25; Def.'s Resp. to PL's Stat, of Mat. Facts ¶25.) This receipt reflected that Burlington Northern had inspected the container upon its return to the container yard and had found no damage. (PL's Stat, of Mat. Facts ¶ 25; Def.'s Resp. to PL's Stat, of Mat. Facts ¶25.) The Ingate Interchange Receipt was also an "equipment interchange receipt" as defined by the UIIA. (PL's Stat, of Mat. Facts ¶26; Def.'s Resp. to PL's Stat, of Mat. Facts ¶ 26.)

In order to facilitate interchange of equipment in situations commonly occurring in marine transport such as those set forth above, Yang Ming and Intermodal both had contracted to participate in a version of the UIIA...