Recent COGSA case from the Sixth Circuit Court of Appeals. The case is Fortis Corporate Ins. v. Viken Ship Mgmt., which can be found here.
First off: the opinion was written by retired Justice Sandra Day O'connor (sheesh, so much for retirement being golf and grandkids).
Facts: during the transport of steel coils from Poland to Ohio, seawater intruded on the cargo hold and caused rust damage. The insurance company paid on the claim then brought a subrogration claim against the vessel owner and the ship's manager (who provided the Master, officers and crew).
Issue: The ship's manager brought a motion for summary judgment to dismiss the suit because it had been filed beyond the one-year statute of limitation in the Carriage of Goods at Sea Act (COGSA).
The ship's manager was trying to say that it was practically a "carrier" under COGSA and if it were a "carrier," then the lawsuit was time-barred.
Analysis: Justice O'connor rejected the "practical" test and found that COGSA was clear in its definition of carriers and ship's managers were not included in that definition. As such, simple negligence claims against non-carrier parties were valid. Justice O'connor noted that the parties were free to contractually expand the COGSA coverages, by way of a Himalaya clause in the bill of lading:
It is important to note that shipping parties are free to extend COGSA’s coverage by adding provisions to bills of lading extending the COGSA regime to any and all agents or independent contractors who participate in the shipment of goods under a particular contract. See Norfolk S. Ry. Co. v. Kirby, 543 U.S. 14, 30–31 (2004). These contractual provisions are known as “Himalaya clauses.” See generally, Marie Healey, Carriage of Goods by Sea: Application of the Himalaya Clause to Subdelegees of the Carrier, 2 Mar. Law 91 (1977). If the parties in this case wanted SM to be covered by COGSA’s terms, they could have provided for that contractually, but they chose not to do so. This is especially telling when the parties were contracting against the backdrop of nearly-uniform case law refusing to extend COGSA’s liabilities and immunities to ship managers absent such a Himalaya clause. The value of maintaining uniformity with our sister circuits is at a premium in cases involving the interpretation of maritime contracts, especially when the parties can easily alter the terms of their contracts to react to prevailing case law. Cf. Kirby, 543 U.S. at 28 (stressing need for uniformity in maritime law).
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