Wemhoener Pressen v. Ceres Marine Terminals

5 F.3d 734 (4th Cir. 1993)

Purchase the Printed Copy at bsmsphd.com

Nature of the Case

To access this section all you need to do is click here and register.

Facts

P is a German corporation that manufactures and sells hydraulic presses for use in woodworking. It sold a press and related machinery to an Ohio business and selected a forwarding agent, ICT Neuss, to ship the press to Ohio at the best price possible. P put the press into a crate and lashed it with steel cables onto a wheeled, non-motorized flatbed trailer called a 'mafi.' Both the mafi and the crate were shipped across Germany to the German port of departure in Bremerhaven, where they were loaded onto the M/V Tadeusz Kosciuszko. The Express Cargo Bill that accompanied the crate served as the bill of lading. Shippers are entitled to avoid liability limitations if they so choose by entering the value of the goods in the space provided on the Express Bill and by paying a higher price to ship the goods. P did not exercise this option. The space designated in the Express Bill as 'value of goods declared of shipper' was left blank. On November 30, 1989, the crate was unloaded by D and transported to a storage area at the terminal, still strapped to the mafi. It remained in storage at the terminal until it could be shipped. The railcars were scheduled to arrive on December 12, 1989. On December 5, D began to strip the crate from the mafi. A cutting torch used to remove the steel cables caused the packaging to catch fire and damaged both the press and mafi. The cost of stripping the mafi (as well as for stripping other mafis) was billed by D to POL pursuant to a written agreement between them, under which Ceres agreed to provide POL with a full range of stevedoring and terminal operation services for a set fee. They loaded the damaged press onto a rail car and it was received by the buyer on December 28, 1989. After repair it now operates at 70% efficiency. P claims that the press had an invoice value of over one million dollars and that components valued at $ 350,000 were damaged by the fire. P sued the vessel, POL, and D. P characterized the basis of its claim against D as negligent and improper handling. POL and D moved for partial summary judgment on the grounds that the liability of each was limited to $ 500 per package. P conceded that POL was liable only for $ 500 based on § 1304(5) of COGSA, which stipulates that the carrier shall not be liable for over $500 per package unless, prior to shipping, the shipper declares a higher value for the goods in the bill of lading. D asserts that it can claim the same limits, based on the 'Himalaya' clause in POL's North America Service Bill of Lading. D claims that while cutting the cables, stripping the crate from the mafi, and preparing the crate for rail transport, it was performing parts of the carriage as a subcontractor for POL and that it therefore was, under the Himalaya clause, entitled to the carrier's COGSA benefits. The district court agreed. The court granted partial summary judgment to D and limited its liability to $500. P appealed.