The key statutes, the Carriage of Goods by Sea Act and the Harter Act, are discussed.
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- Amos Clarke
- 5 years ago
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2 This course serves as a basic introduction in an attempt to try to make the practitioner aware of the things that she or he needs to know about pursuing cargo claims. The lecture follows the evolution of a cargo claim from the beginning through completion. This is viewed from the standpoint of the cargo interest, the insurance company as well as the steamship company. Both the claims process and the litigation process are dealt with in this presentation. The key statutes, the Carriage of Goods by Sea Act and the Harter Act, are discussed. DISCLAIMER: The following materials and accompanying Access MCLE, LLC audio program are for instructional purposes only. Nothing herein constitutes, is intended to constitute, or should be relied on as, legal advice. The author expressly disclaims any responsibility for any direct or consequential damages related in any way to anything contained in the materials or program, which are provided on an as-is basis and should be independently verified by experienced counsel before being applied to actual matter. By proceeding further you expressly accept and agree to Author s absolute and unqualified disclaimer of liability.
3 Check out to see if in fact your client has insurance. Insurance is typically bought and paid for under a cargo policy. These are first party insurance policies. Your client could be an insured under a specific insurance company. Companies that do a lot of importing and exporting and shipping usually have this coverage under their own policies. It is possible that your client might have bought insurance from an ocean freight forwarder under what is called an open cargo policy. The policy and/or the insurance certificate will also have a section stating who to notify in the event of the claim.
4 On an international shipment, the statute of limitation is only one year from the date of delivery or when delivery should have been made. Sometimes a client might contact you near the 1 year statute limitation. It is sometimes possible to get an extension of time for filing suit beyond the one year statute of limitation. It is sometimes possible to get an extension of time for filing suit beyond the one year statute of limitation. These extensions of time should be in writing.
5 Under the cases of Norfolk Southern R. Co. v. James N. Kirby, 543 U.S. 14 (2004), and Kawasaki Kisen Kaisha Ltd. v. Regal-Beloit Corp., 130 S. Ct (2010), an ocean bill of lading will supersede the trucker bills of lading. The statute of limitations is different for interstate trucking claims so this becomes an important factor to consider.
6 The judges who are most familiar with these claims are in U.S. District Court. State Court Judges do not get as many of these claims. There is generally considered to be jurisdiction for these cases in State Court although the backs of the bills of lading will have to be checked to see if there are jurisdictional clauses stating that the forum is located elsewhere. Some of these are for another state or country. Others require arbitration. You will want to check this before winding up with a problem later on.
7 The Carriage of Goods by Sea Act does have a provision at 46 U.S.C.A limiting damages to $ per package or a customary freight unit. Was due to improper packing or stowage by the shipper? If the bill of lading contains the term shippers load and count, then the shipper must prove the contents and the condition of the cargo. There is a clause stating that if the damages caused by something other than the fault of the carrier. This is called the q clause, see Benedict on Admiralty at Chapter 2A-XV 151. This places a heavy burden of proof on the steamship company.
8 There is also an Act of Nature Defense. In other words, if the loss was caused by a hurricane or flood. Of course this depends on what advance notice there was and the preparation used to prevent a loss. These defenses can be found at 46 U.S.C (2), and include the following: (a) (b) (c) (d) Act, neglect, or default of the master, mariner, pilot, or the servants of the carrier in the navigation or in the management of the ship; Fire unless caused by the actual fault or privity of the carrier; Perils, dangers, and accidents of the sea or other navigable waters; Act of God;
9 (e) Act of war; (f) (g) (h) (i) (j) Act of Public enemies; Arrest of restraint of princes, rulers, or people, or seizure under legal process; Quarantine restrictions; Act of omission of the shipper or owner of the goods, his agent or representative; Strikes or lockouts or stoppage or restraint of labor from whatever cause, whether partial or general: Provided, That nothing herin contained shall be construed to relieve a carrier from responsibility for the carrier s own acts;
10 (k) (l) (m) (n) (o) (p) Riots and civil commotions; Saving or attempting to save life or property at sea; Wastage in bulk or weight or any other loss or damage arising from inherent defect, quality, or vice of the goods; Insufficiency of packing; Insufficiency of packing; Latent defects not discoverable by due diligence
11 If there is a deviation, these defenses, particularly the $ per package limitation may not apply. This can occur when the cargo is delivered to the wrong port or shipped on deck when the cargo should be placed below deck. Deviation can be thought of as a material breach of contract. See General Electric Co. International Division v. S.S. Nancy Lykes, 706 F. 2d 89 (2d Cir. 1983). Deviation is also referenced in 46 U.S.C.A. 1304(4). Most of these cases are bench trials, particularly if they are brought as admiralty cases in Federal Court. It is possible to get a jury trial in State Court and possibly under diversity.
12 Ocean carriers usually have a form of coverage through what are called Protection and Indemnity Associations. They claim that they are not insurance companies. They only pay claims after the member of the P & I Club has paid the club. Many of these clubs are located in England and Scandinavia. There is one American Club called the American P and I Club. The parties in the club are referred to as members. Again, there is some debate as to whether or not these associations are insurance companies. The NVOCC s sometimes have more normal forms of liability insurance.
13 The Harter Act takes over after the goods are placed on the dock. This has been an important statute that is involved with a series of cases dealing with delivery of goods into a government facility. These include Crowley Am. Transpo., Inc., v. Richard Sewing Mach. Co., 172 F. 3d 781 (11th Cir. 1999). and All State Ins. Co. v. Inversiones Navieras Imparca, C.A., 646 F. 2d 169 (5th Cir. 1981). The Pomerene Act or Bill of Lading act can be found at Pomerene Act, 49 U.S.C. 8 et seq. in its earlier form and currently at 49 U.S.C et al. It does cover shipments that travel within the United States and from the United States to a foreign country. Many of these statutes deal with enforcement of liens.
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22 Daniel W. Raab, Esq. is an attorney with offices in Miami, Florida. He is a graduate of the Johns Hopkins University and the University of Miami School of Law. He is the author of Transportation Terms and Conditions, Chapter 47 of the New Appleman Practice Law Guide, Chapter 5 of the Benedict on Admiralty Desk Reference Book, and a Contributing Author to Goods In Transit. He has taught as an Adjunct Professor of Law at the University of Miami School of Law, St. Thomas University School of Law, and the Florida International University College of Law and has spoken to various groups on issues involving Transportation and Insurance Law. His law practice includes the representation of steamship companies, ocean freight forwarders, motor carriers, surface transportation brokers, insurance companies, importers, and exporters.
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