ZK Marine, Inc. v. M/v Archigetis

• Decision Date: 03 December 1992
• Docket Number: No. 88-1715-Civ.,88-1838-Civ.,88-1715-Civ.
• Citation: 808 F. Supp. 1561
• Parties: Z.K. MARINE, INC. and Southern Offshore Yachts, Inc., Plaintiffs, v. M/V ARCHIGETIS, her engines, tackle, furnishings, etc. in rem, Malvern Maritime, Inc., her owner, operator, etc., Federal Pacific (Liberia), LTD., a division of Fednav Limited d/b/a Fedpac Lines; Continental Stevedoring Terminals, Inc., and Off Shore Marine, Inc., Defendants. JAY BETTIS AND CO. OF FLORIDA, and Miller Yacht Sales, Inc., Plaintiffs, v. FEDERAL PACIFIC (LIBERIA), LTD., and Fednav Limited, d/b/a Fedpac Lines, Malvern Maritime, Inc., and the M/V ARCHIGETIS, in rem, its engines, furniture, tackle, apparel, etc., Defendants.
• Court: U.S. District Court — Southern District of Florida

808 F. Supp. 1561

Z.K. MARINE, INC. and Southern Offshore Yachts, Inc., Plaintiffs, v. M/V ARCHIGETIS, her engines, tackle, furnishings, etc. in rem, Malvern Maritime, Inc., her owner, operator, etc., Federal Pacific (Liberia), LTD., a division of Fednav Limited d/b/a Fedpac Lines; Continental Stevedoring Terminals, Inc., and Off Shore Marine, Inc., Defendants.

JAY BETTIS AND CO. OF FLORIDA, and Miller Yacht Sales, Inc., Plaintiffs, v. FEDERAL PACIFIC (LIBERIA), LTD., and Fednav Limited, d/b/a Fedpac Lines, Malvern Maritime, Inc., and the M/V ARCHIGETIS, in rem, its engines, furniture, tackle, apparel, etc., Defendants.

Nos. 88-1715-Civ., 88-1838-Civ.

United States District Court, S.D. Florida.

December 3, 1992.

Robert Lamar Bell, Miami, FL, Lawrence B. Brennan, Bigham, Englar, Jones & Houston, New York City, for plaintiffs Bettis/Miller Yacht.

Robert A. Craven, McIntosh & Craven, Fort Lauderdale, FL, for plaintiff Z.K. Marine.

Fernando S. Aran, Coral Gables, FL, for defendants Fedpac/Fednav.

Allan Kelley, Fowler, White, Burnett, Hurley, Banick & Strickroot, Miami, FL, for defendant Malvern Maritime.

ORDER

HOEVELER, District Judge.

THIS CAUSE comes before the Court upon Z.K. Marine's¹ and Jay Bettis and Miller Yacht Sales' Motions to Alter, Amend or Correct Judgment or Order Pursuant to Rules 59(e) and 60(b) of the Federal Rules of Civil Procedure. Plaintiffs have moved the Court to reconsider its January 8, 1991 Omnibus Order² granting partial summary judgment to Defendants, thereby limiting their liability to $500 per lost or damaged yacht.

The Court heard argument on Plaintiffs' Motions in August of 1991. It then requested supplemental memoranda and further oral argument limited to the question of what law applies to the instant situation — the Carriage of Goods by Sea Act ("COGSA"), the Hague Rules, the Hague Visby Rules, or the Harter Act. Having duly considered the supplemental memoranda and argument of counsel, the Court is now prepared to rule on this issue.

STANDARD OF REVIEW

"The purpose of a motion for reconsideration is to correct manifest errors of law or fact or to present newly discovered evidence." Harsco Corp. v. Zlotnicki, 779 F.2d 906, 909 (3rd Cir.1985), cert. denied, 476 U.S. 1171, 106 S.Ct. 2895, 90 L.Ed.2d 982 (1986). A motion for reconsideration should not be used as a vehicle to present authorities available at the time of the first decision or to reiterate arguments previously made:

It is an improper use of the motion to reconsider to ask the Court to rethink what the Court ... already thought through — rightly or wrongly.... The motion to reconsider would be appropriate where, for example, the Court has patently misunderstood a party, or has made a decision outside the adversarial issues presented to the Court by the parties, or has made an error not of reasoning but of apprehension. A further basis for a motion to reconsider would be a controlling or significant change in the law or facts since the submission of the issue to the Court. Such problems rarely arise and the motion to reconsider should be equally rare.

Above the Belt, Inc. v. Mel Bohannan Roofing, Inc., 99 F.R.D. 99, 101 (E.D.Va. 1983); Moog, Inc. v. United States, No. 90-215E, 1991 WL 255371, at *1, 1991 U.S. Dist. LEXIS 17348, at *2 (W.D.N.Y. Nov. 21, 1991).

While the Court ultimately agrees with Defendants' assertion that Plaintiffs' motions are both procedurally flawed and substantively unpersuasive, in reviewing its January 8, 1991 Omnibus Order the Court found some of its language to be unclear and potentially misleading. Thus, the Court writes here to clarify the reasoning supporting its earlier conclusions.

DISCUSSION

Plaintiffs assert that the Court erred in its original determination of the facts and law of this case. The Court has thoroughly examined Plaintiffs' various arguments and finds that none are meritorious.

In the January 8, 1991 Order this Court held that COGSA, with its $500 per package limitation on carrier liability, does not apply of its own force to the instant contract because COGSA does not automatically extend to goods carried "on-deck"; however, it went on to hold, based on the language of the bills of lading, that the parties had contractually extended COGSA's provisions to this shipment. Z.K. Marine, 776 F.Supp. at 1553. While the Court remains confident that this conclusion was correct, it recognizes that some of the language of its January 8, 1991 opinion was confusing and may have caused Plaintiffs to believe the Court had misapprehended the law or the parties' arguments. The Order stated:

The language of the paramount clause in the bills of lading does not directly refer to COGSA. Rather, it appears to require that the Hague or Hague/Visby Rules be applied. The Hague Rules were, however, codified in COGSA. Thus the parties appear to have stipulated by contract that COGSA would apply to these bills of lading. Accordingly, this Court finds that COGSA applies to this situation.

Id. (citations and footnotes omitted). While the result that COGSA applies is correct, COGSA is not identical to either the Hague or the Hague Visby Rules, and the Court did not mean to imply that COGSA applies for that reason. Rather, COGSA controls because the paramount clause — read in conjunction with clauses nine and eighteen — evidences the parties' intent to extend COGSA to this contract for the on-deck carriage of five yachts.

COGSA is the U.S. codification of the original Hague Rules and is generally applicable to goods shipped from foreign ports to ports in the United States. 46 U.S.C.App. §§ 1300-1315; Sunkist Growers, Inc. v. Adelaide Shipping Lines, Ltd., 603 F.2d 1327 (9th Cir.1979) cert. denied, 444 U.S. 1012, 100 S.Ct. 659, 62 L.Ed.2d 640 (1980). It is undisputed that COGSA does not apply ex proprio vigore to this contract because the definition of "goods" provided in 46 U.S.C.App. § 1301(c) does not include carriage of "on-deck" cargo.³ Nonetheless, it is well established that COGSA can be extended to contracts to which it does not apply of its own force if the parties so agree. Colgate Palmolive Co. v. S/S Dart Canada, 724 F.2d 313 (2nd Cir.1983), cert. denied, 466 U.S. 963, 104 S.Ct. 2181, 80 L.Ed.2d 562 (1984); Pannell v. The American Flyer, 157 F.Supp. 422 (S.D.N.Y.1957), mod., 263 F.2d 497 (2nd Cir.1959), cert. denied, 359 U.S. 1013, 79 S.Ct. 1151, 3 L.Ed.2d 1037 (1959). Defendants contend that although COGSA does not apply ex proprio vigore, the bills of lading evidence the parties' agreement to extend COGSA to this contract. Plaintiffs counter that the Harter Act⁴ applies, or in the alternative, that the Hague or Hague Visby Rules control.⁵

Plaintiffs contend that even if the Court was not mistaken about the applicable law or facts, reconsideration is appropriate because the Court's Order is inconsistent with the Eleventh Circuit precedent established by the Ocean Lynx decision. Insurance Co. of North America v. M/V Ocean Lynx, 901 F.2d 934 (11th Cir.1990), cert. denied, 498 U.S. 1025, 111 S.Ct. 675, 112 L.Ed.2d 667 (1991). That case directly addressed the issue of extending COGSA to acts and circumstances not mandated by its language. At oral argument Plaintiffs asserted that this Court did not follow the test established in Ocean Lynx.

Plaintiffs' reliance on Ocean Lynx is misplaced for two reasons: first, Ocean Lynx was decided prior to this Court's Omnibus Order, and thus is not "new law" upon which a motion for reconsideration is properly based; second, even if Ocean Lynx did provide a new legal theory for Plaintiffs, it is not in any way inconsistent with this Court's earlier decision. In a convenient and well-ordered fashion the Ocean Lynx opinion sets out the "notice and opportunity" test that courts — including this Court — have been using for some time. The test simply identifies and discusses the various concerns this Court already considered when it determined that COGSA was extended to the contract at issue. The Ocean Lynx Court held that to contractually extend COGSA's liability limitation the carrier must:

1) give the shipper adequate notice of the $500 liability limitation by including a paramount clause in the bill of lading expressly adopting the provisions of COGSA, and

2) give the shipper a fair opportunity to avoid COGSA's liability limitation by declaring excess value.

Ocean Lynx, 901 F.2d at 939. Both prongs of this two-part test were met by the carrier in the instant case.

I. Clause Three: The Paramount Clause

The purpose of a paramount clause is to establish what law will apply to the entire contract. It is not designed to detail the specific provisions of the governing law; it simply functions to identify the legal framework within which the remaining provisions of the contract will be construed. While the language of the paramount clause in this case does not list COGSA by name, a careful reading of its four-step hierarchy of applicable law leads to the inevitable conclusion that COGSA governs this contract. In the interests of clarity, the Court will parse the paramount clause to demonstrate why subclause three controls, dictating application of COGSA. The paramount clause reads as follows:

This Bill of Lading shall have effect subject to the provisions of any legislation incorporating the Rules contained in the International Convention for the Unification of certain rules relating to Bills of Lading dated Brussels, August 25th 1924 (the Hague Rules) or those Rules as amended by the Protocol signed at Brussels February 23rd 1968 (the Hague Visby Rules) and which is compulsorily applicable to the contract of carriage contained herein.⁶ If no such legislation is compulsorily applicable, the Hague Rules or, if applicable, the Hague Visby Rules as enacted in the country of the port of loading shall apply.⁷ When no such enactment is in force in the country of the port of loading, the corresponding legislation of the country of the port of

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