Konica Business Machines, Inc. v. The Vessel 'Sea-Land Consumer'

153 F.3d 1076 (9th Cir. 1998)

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Nature of the Case

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Facts

P purchased 44 photocopiers from Konica Corporation of Japan which, in turn, contracted with D to ship the copiers to the U.S. D issued P a clean bill of lading. A clean bill of lading is a contract for the carriage of goods that does not specify where the goods will be stowed but effectively represents under-deck cargo stowage. D is a specially-designed containership with greater carrying capacity above deck than below deck. Once a contained is secured, D's manual requires the insertion of locking pins to insure that the twist-locks stay in the locked position. D stored P's container on deck in a stacking frame. D admitted that it did not insert the locking pins. The Chief Mate believed the locking pins 'unnecessary'; he had never seen the twist-lock move from locked to unlocked during a voyage, even in severe storm conditions. During very rough weather, the twist-locks came unlocked and P's container (and ten others) fell overboard. P sued to recover the full value of the copiers. The terms of the bill of lading limited D’s liability to $1,000 for each copier. P sued D for the full value of $230,028.48. The district court entered summary judgment in favor of P. The appeals court reversed and remanded for trial, holding that D raised a triable issue of material fact as to the existence of 'a port custom or general usage of the trade' permitting the carriage of goods above deck under a clean bill of lading. The district court found that D was entitled to limit its liability under the bill of lading because (1) container stowage on deck was a well-established custom and was reasonable in light of the ship's design, and (2) the failure to place the locking pins in the twist-lock mechanism was merely negligent and not an unreasonable deviation from the contract. P appealed.