Farm Bureau Ins. Co. v. TNT Equip., Inc.
Court of Appeals of Michigan
June 20, 2019, Decided
No. 343307

Reporter
2019 Mich. App. LEXIS 3296 *
FARM BUREAU INSURANCE COMPANY, Subrogee of JEFF FURNESS, FREDRIC WILSON, KENNY MALBURG’S LANDSCAPING, INC., and TIMOTHY DEMARAY, and PIONEER MUTUAL INSURANCE COMPANY, Subrogee of JAY D. FERGUSON, AMANDA FERGUSON, D & R HENNE FARMS, INC., and DOROTHY WALTON and LYNN WALTON, doing business as WALTON FARMS, and HASTINGS MUTUAL INSURANCE COMPANY, Subrogee of JAMES T. YOUNG, SHELLY YOUNG, MARVIN HILL, LOIS HILL, CLIFFORD C. KESSLER, and SHIRLEY KESSLER, Plaintiffs-Appellees, v TNT EQUIPMENT, INC., Defendant, and EMPLOYERS MUTUAL CASUALTY COMPANY, Defendant-Appellant.
Notice: THIS OPINION IS UNCORRECTED AND SUBJECT TO REVISION BEFORE PUBLICATION IN THE MICHIGAN COURT OF APPEALS REPORTS.
Prior History: [*1] Sanilac Circuit Court LC No. 16-036858-NZ.

GADOLA, J.
Defendant, Employers Mutual Casualty Company (Employers), appeals as of right the order of the trial court dismissing without prejudice defendant, TNT Equipment, Inc. (TNT), and challenges the earlier orders of the trial court granting plaintiffs’ motion for summary disposition, while denying Employers’ motions for summary disposition and for reconsideration. We reverse the order of the trial court granting plaintiffs summary disposition, and remand to the trial court for entry of summary disposition in favor of Employers.
I. FACTS
This case arises from a fire that occurred at a storage facility owned by TNT in Sandusky, Michigan, on April 5, 2016. Plaintiffs are insurance companies. The parties do not dispute that plaintiffs’ insureds owned farm equipment that was stored at the TNT facility at the time of the fire, and that plaintiffs, having paid claims to their insureds for the damaged farm equipment, are now subrogees of the rights of their insureds.
At the time of the fire, Employers had issued to TNT a “Commercial Inland Marine” policy of insurance that was then in [*2] effect. Plaintiffs sought reimbursement from Employers for the amounts they had paid to their insureds for the damaged farm equipment, contending that plaintiffs’ insureds were entitled to coverage under Employers’ policy with TNT, and that plaintiffs were therefore entitled, as subrogees, to payment from Employers. Employers declined to pay plaintiffs. Employers explained that TNT had exercised an option under the policy directing Employers “to pay for their [TNT’s] customer’s deductibles and verifiable uninsured losses only.” Employers determined that because TNT had opted out of any other coverage, it was not obligated to pay any other amounts for damages to the farm equipment belonging to plaintiffs’ insureds.
Plaintiffs, as subrogees of their insureds, initiated this lawsuit, alleging counts against TNT for breach of bailment contracts, breach of implied warranty, negligence, gross negligence, and warehouse liability. Plaintiffs also asserted claims against Employers, seeking first-party insurance benefits under Employers’ policy with TNT, and alternatively, seeking benefits under the policy as third-party beneficiaries. The parties filed cross-motions for summary disposition under [*3] MCR 2.116(C)(8), (9), and (10), regarding whether plaintiffs had a right to enforce the policy and claim benefits from Employers directly under the insurance policy. The trial court concluded that plaintiffs’ insureds were entitled to the status of “additional insureds” under the policy, and therefore were entitled to enforce the policy against Employers. The trial court then granted plaintiffs summary disposition under MCR 2.116(C)(10), while denying Employers summary disposition. The trial court thereafter denied Employers’ motion for reconsideration.
The trial court also entered an order dismissing TNT from the case without prejudice.1 Employers now appeals to this Court from the trial court’s final order dismissing TNT, challenging the earlier orders of the trial court granting plaintiffs summary disposition and denying Employers’ motions for summary disposition and for reconsideration.
II. DISCUSSION
A. STANDARD OF REVIEW
This Court reviews de novo a trial court’s decision to grant or deny summary disposition. Johnson v Vanderkooi, 502 Mich 751, 761; 918 NW2d 785 (2018). When reviewing an order granting summary disposition under MCR 2.116(C)(10), we consider all documentary evidence submitted by the parties in the light most favorable to the nonmoving party. Dawoud v State Farm Mut Auto Ins Co, 317 Mich App 517, 520; 895 NW2d 188 (2016) [*4] . Summary disposition under MCR 2.116(C)(10) is warranted when there is no genuine issue as to any material fact and the moving party is entitled to judgment as a matter of law. Id. We also review de novo issues involving the proper interpretation of statutes and contracts. Titan Ins Co v Hyten, 491 Mich 547, 553; 817 NW2d 562 (2012). This Court reviews a trial court’s decision to grant or deny a motion for reconsideration for an abuse of discretion. Sanders v McLaren-Macomb, 323 Mich App 254, 264; 916 NW2d 305 (2018). A trial court abuses its discretion if it chooses an outcome outside the range of principled outcomes. Id.
B. FIRST-PARTY INSURED
Employers contends that the trial court erred in granting plaintiffs summary disposition because plaintiffs are not entitled to enforce the insurance policy between Employers and TNT. Employers first argues that plaintiffs’ insureds were not insureds under the policy issued to TNT by Employers, and therefore lacked standing to pursue first-party benefits under the policy, and that plaintiffs, as subrogees of their insureds, likewise lack standing to seek first-party benefits under the policy. We agree.
An insurance policy, like other contracts, is an agreement between parties; a court’s task is to determine what the agreement is and then give effect to the intent of the parties. Waldan Gen Contractors, Inc v Michigan Mut Ins Co, 227 Mich App 683, 686; 577 NW2d 139 (1998). In doing so, we consider the contract as a whole and give meaning to all terms of the contract. Auto-Owners Ins Co v Churchman, 440 Mich 560, 566; 489 NW2d 431 (1992). We give the policy language its ordinary and plain meaning, and where policy language is clear, we are bound by the language of the policy. Waldan, 227 Mich App at 686.
An insurance policy is a contractual agreement between the insured and the insurer. West American Ins Co v Meridian Mut Ins Co, 230 Mich App 305, 310; 583 NW2d 548 (1998). Payment of benefits from one’s own insurer generally is referred to as payment of first-party benefits. See Nickola v MIC Ins Co, 500 Mich 115, 127; 894 NW2d 552 (2017) (“the insured by definition [*5] is a party to the insurance contract, not a third party.”) This Court has suggested that a “first-party” insured is the insured under a policy, or an individual or entity directly entitled to benefits under the insured’s insurance policy. See Griswold Properties, LLC v Lexington Ins Co, 276 Mich App 551, 565; 741 NW2d 549 (2007).
In this case, TNT purchased from Employers a policy of commercial inland marine insurance.2 The parties do not dispute that plaintiffs’ insureds were not parties to the policy between TNT and Employers, and that plaintiffs’ insureds are not named insureds under that policy. There further is no dispute that the policy does not expressly grant anyone other than the named insured enforcement rights. Plaintiffs’ insureds, therefore, had no express contractual rights under the policy and are not entitled to “first-party” benefits. The question, then, is whether plaintiffs’ insureds, though not named insureds under the policy, are nonetheless entitled to seek to enforce the policy.
C. ADDITIONAL INSURED
Plaintiffs argue, and the trial court found, that plaintiffs’ insureds were entitled to enforce the contract as “additional insureds” under TNT’s policy with Employers. An “additional insured” is defined generally as “[s]omeone who is covered by an insurance [*6] policy but who is not the primary insured. An additional insured may, or may not, be specifically named in the policy.” Black’s Law Dictionary (11th ed). Plaintiffs in this case do not contend that the policy here designated plaintiffs’ insureds as “additional insureds” under the policy, and point to no published Michigan authority3 supporting their position that they qualify as additional insureds absent a provision in the policy designating them as such. We therefore conclude that the trial court erred in finding plaintiffs, as subrogees of their insureds, to be additional insureds under the policy in question.
D. THIRD-PARTY BENEFICIARY
Michigan law does recognize, however, the rights of a third-party beneficiary to seek enforcement of a policy of insurance. In Michigan, a person who is a nonparty to a contract may be entitled to sue to enforce the contract as a third-party beneficiary. MCL 600.1405; Shay v Aldrich, 487 Mich 648, 666; 790 NW2d 629 (2010). A person is a third-party beneficiary of a contract only if the contract establishes that a promisor has undertaken a promise directly to or for that person. Koenig v South Haven, 460 Mich 667, 676-677; 597 NW2d 99 (1999). A thirdparty beneficiary of a contract may enforce a contract against the promisor because the thirdparty beneficiary “stands in the shoes” [*7] of the promisee. White v Taylor Distrib Co, Inc, 289 Mich App 731, 734; 798 NW2d 354 (2010). In that regard, the third-party beneficiary statute provides, in relevant part:
Any person for whose benefit a promise is made by way of contract, as hereinafter defined, has the same right to enforce said promise that he would have had if the said promise had been made directly to him as the promisee.
(1) A promise shall be construed to have been made for the benefit of a person whenever the promisor of said promise had undertaken to give or to do or refrain from doing something directly to or for said person. [MCL 600.1405.]
To create a third-party beneficiary, a contract must “expressly contain a promise to act to benefit the third party.” White, 289 Mich App at 734. “[T]he plain language of this statute reflects that not every person incidentally benefitted by a contractual promise has a right to sue for breach of that promise . . . .” Brunsell v Zeeland, 467 Mich 293, 296; 651 NW2d 388 (2002). Rather, only intended beneficiaries, not merely incidental beneficiaries, may sue for breach of a contract. Schmalfeldt v North Pointe Ins Co, 469 Mich 422, 427; 670 NW2d 651 (2003). We use an objective standard to determine from the language of the contract itself whether the promisor undertook to give or to do, or to refrain from doing, something directly to or for the person asserting status as a third-party beneficiary. Brunsell, 467 Mich at 298. In doing so, [*8] we do not focus on the subjective intent of the contracting parties, but instead focus upon the intent of the contracting parties as determined solely from the “form and meaning” of the contract to determine whether the promisor undertook to give or to do or to refrain from doing something directly to or for the person claiming status as a third-party beneficiary. Shay, 487 Mich at 665.
Thus, the focus of the inquiry in this case is whether Employers, by virtue of its agreement to insure TNT, undertook to give or to do, or to refrain from doing, something directly to or for plaintiffs’ insureds within the meaning of the third-party beneficiary statute, MCL 600.1405. Plaintiffs argue that the coverage provisions of Employers’ policy with TNT demonstrate that Employers undertook to provide plaintiffs’ insureds with coverage, thereby making them intended beneficiaries, under the following provisions:

A. Coverage
1. Covered Property, as used in this Coverage Form, means the type of property described in this Section A.1. . . .
* * *
a. Coverage A — Stock, Furniture, Fixtures, Equipment and Tenants Improvements and Betterments — Business Personal Property Includes:
(1) Stock: We will pay for direct physical loss of or damage [*9] to stock of merchandise, including the value of your labor, materials or services furnished or arranged by you on personal property of others, consisting principally of agricultural, construction and materials handling equipment, and appliances, parts, accessories thereof, and other merchandise usual or incidental to your business of agricultural, construction and materials handling equipment dealers . . . .
(2) Furniture, Fixtures, Equipment and Tenant’s “Improvements and Betterments”:
We will pay for loss or damage to:
(a) Furniture, fixtures and equipment used in your business and similar property held by you and belonging in whole or in part to others for not more than the amount for which you are liable . . . .
* * *
b. Coverage B — Property of Others
We will pay for direct physical loss of or damage to property of others, which is similar to that described in Coverage A above, while such property is in your care, custody or control. . . .
* * *

M. Payment of Losses
Loss, if any, under this Coverage Form is payable to you for the account of all interests. You agree to make proper distribution of funds so received to other parties in interest and to hold us harmless from any and all claims [*10] for damages which may be made against us by other interests as a result of and to the extent of such payments.
The separate loss-payable endorsement defines “you” and “your” as referring to the named insured, and then states, “Any loss shall be adjusted with ‘you’ and shall be payable to ‘you’ and the loss payee described on the ‘declarations’ as ‘your’ and their interests appear.” Although under the policy Employers promises to pay for direct physical loss of or damage to property of others, this promise is directed to TNT, not to plaintiffs’ insureds. We also observe that Employers makes no promise to plaintiffs’ insureds under the payment of loss provisions of the policy in this case, which include the following provisions, in pertinent part:

LOSS CONDITIONS
* * *

E. Loss Payment
* * *
3. We may adjust losses with the owners of lost or damaged property if other than you. If we pay the owners, such payments will satisfy your claim against us for the owners’ property. We will not pay the owners more than their financial interest in the Covered Property.
* * *
6. We will not be liable for any part of a loss that has been paid or made good by others.

F. Other Insurance
1. You may have other insurance [*11] subject to the same plan, terms, conditions and provisions as the insurance under this Coverage Part. If you do, we will pay our share of the covered loss or damage. Our share is the proportion that the applicable Limit of Insurance under this Coverage Part bears to the Limits of Insurance of all insurance covering on the same basis.
2. If there is other insurance covering the same loss or damage, other than that described in 1 above, we will pay only for the amount of covered loss or damage in excess of the amount due from that other insurance, whether you can collect on it or not. But we will not pay more than the applicable Limit of Insurance.
Plaintiffs argue that their insureds’ damaged property falls under the provisions covering the property of others, and that their insureds therefore are beneficiaries entitled to enforce the contract. But the coverage provisions do not articulate a promise to pay plaintiffs’ insureds; rather it is a promise to TNT to pay TNT, or others on behalf of TNT, for damage to property owned by others that is in the care, custody, or control of TNT. Although the owners of damaged property may, in certain circumstances, realize a benefit from TNT having [*12] coverage for such damage, the policy contains no promise to directly benefit plaintiffs’ insureds within the meaning of MCL 600.1405. “Only intended beneficiaries, not incidental beneficiaries, may enforce a contract under [MCL 600.]1405.” Schmalfeldt, 469 Mich at 429. Because the policy does not directly promise to do or not do something for plaintiffs’ insureds, plaintiffs’ insureds do not rise to the status of third-party beneficiaries under the policy, and therefore have no right to seek to enforce the policy between TNT and Employers.4
In analyzing this question, a review of our Supreme Court’s decision in Schmalfeldt is instructive. In that case, the plaintiff was injured in a bar fight and incurred extensive dental expenses. He sought payment for his dental expenses from the bar owner, who refused. The plaintiff then sought payment directly from the bar owner’s insurer who had issued a commercial liability insurance policy to the bar owner. The policy included a provision in which the insurer agreed to pay up to $5,000 for medical expenses for bodily injury incurred in the bar, regardless of fault. The bar owner, however, told the insurer that the bar did not want to invoke the medical coverage provision of the policy [*13] in that case, and the insurer consequently denied the plaintiff’s request for benefits.5
The plaintiff then sued the insurer directly,6 claiming to be a third-party beneficiary under the insurance policy by virtue of the medical benefits provision of the policy, which the plaintiff argued enabled him to sue the insurer to enforce the terms of the contract. The trial court denied the plaintiff’s motion for summary disposition, determining that the plaintiff was not a thirdparty beneficiary under the policy. On appeal within the civil division of that court, the trial court held, to the contrary, that the plaintiff was directly benefitted under the policy and therefore was a third-party beneficiary empowered to seek to enforce the contract. This Court reversed, determining that the plaintiff was an incidental beneficiary only, and thus not entitled to enforce the contract between the insurer and the bar owner. Our Supreme Court affirmed, agreeing that the plaintiff was not a third-party beneficiary. The Court explained:
A person is a third-party beneficiary of a contract only when that contract establishes that a promisor has undertaken a promise “directly” to or for that person. [*14] MCL 600.1405; Koenig v South Haven, 460 Mich 667, 677; 597 NW2d 99 (1999). By using the modifier “directly,” the Legislature intended “to assure that contracting parties are clearly aware that the scope of their contractual undertakings encompasses a third party, directly referred to in the contract, before the third party is able to enforce the contract. Id. An objective standard is to be used to determine, “from the form and meaning of the contract itself,” Kammer Asphalt v East China Twp, 443 Mich 176, 189; 504 NW2d 635 (1993) (citation omitted), whether the promisor undertook “to give or to do or to refrain from doing something directly to or for” the person claiming third-party beneficiary status, Brunsell [v Zeeland], supra [467 Mich] at 298. [Schmalfeldt, 469 Mich at 428.]
Concluding that the plaintiff in that case was not entitled to claim third-party beneficiary status, our Supreme Court further explained:
Only intended beneficiaries, not incidental beneficiaries, may enforce a contract under § 1405. Koenig [v South Haven], supra [460 Mich] at 680. Here, the contract primarily benefits the contracting parties because it defines and limits the circumstances under which the policy will cover medical expenses without a determination of fault. This agreement is between the contracting parties, and [the plaintiff] is only an incidental beneficiary [*15] without a right to sue for contract benefits. [Schmalfeldt, 469 Mich at 429.]
In this case, focusing on the “form and meaning” of the policy, we similarly conclude that the policy issued by Employers to TNT contains no promise by Employers to directly benefit plaintiffs’ insureds within the meaning of MCL 600.1405. Plaintiffs’ insureds, therefore, were not third party beneficiaries under the policy. Because plaintiffs’ insureds were neither insureds nor third-party beneficiaries under the policy, they had no right to seek to enforce the policy between TNT and Employers.
In so concluding, we emphasize that the inquiry here is not whether there was coverage under the policy for the damage to the property of plaintiffs’ insureds; the question of coverage is a separate inquiry that a court need not reach unless it is determined that a claimant, in fact, has a right to seek enforcement of the policy. See Shay, 487 Mich at 665-667. Rather the inquiry here is whether plaintiffs’ insureds are members of a class (being either insureds or third-party beneficiaries), that empower them to seek to enforce the policy. In this case, the clear and unambiguous language of the policy does not evidence an intent of the parties to directly benefit plaintiffs’ insureds. [*16] 7 We observe that “it is impossible to hold an insurer liable for a risk it did not assume,” Hunt v Drielick, 496 Mich 366, 373; 852 NW2d 562 (2014) (quotation marks and citation omitted), and that the primary goal when interpreting an insurance policy is to honor the intent of the parties to that policy. Tenneco, Inc v Amerisure Mut Ins Co, 281 Mich App 429, 444; 761 NW2d 846 (2008).
Here, TNT and Employers entered into a contract for the purpose of insuring TNT, should TNT be found liable for payment of damages to the property of others that was under its care, custody, or control. The question whether coverage under the policy would be triggered if TNT were found liable for damage to the property of plaintiffs’ insureds is not before us. Rather, plaintiffs seek to enforce the policy and trigger coverage under the policy between TNT and Employers regardless of whether TNT is liable and regardless of whether TNT wants the coverage. The issue thus before us is whether plaintiffs, by virtue of the subrogated rights of their insureds, have a right to enforce the contract between TNT and Employers.
We conclude that the policy in question does not establish plaintiffs’ insureds as insureds under the policy, nor were plaintiffs’ insureds third-party beneficiaries under the policy. As in Schmalfeldt, plaintiffs’ insureds [*17] were, at best, members of a broad class whom the policy recognized as, in certain circumstances, potential recipients of incidental benefits from the policy. As such, plaintiffs’ insureds were incidental beneficiaries only, not qualifying for thirdparty status under MCL 600.1405. See Schmalfeldt, 469 Mich at 429. Plaintiffs therefore have no right to seek to enforce the policy between TNT and Employers.
Reversed and remanded for further proceedings consistent with this opinion. We do not retain jurisdiction.
/s/ Michael F. Gadola
/s/ Christopher M. Murray
/s/ Jonathan Tukel

2019 WL 2269948

United States District Court, S.D. California.
INDEMNITY INSURANCE COMPANY OF NORTH AMERICA, INC., Plaintiff,
v.
SERVICIOS REFRIGERADOS INTERNACIONALES, S.A. DE C.V., Defendant.
Case No.: 19-CV-283-CAB-BLM
|
Signed 05/28/2019
Attorneys and Law Firms
Adam C. Brown, Hill Rivkins Brown & Associates, Fair Oaks, CA, for Plaintiff.
Kenneth H. Stone, The Stone Law Group, San Diego, CA, for Defendant.

ORDER GRANTING DEFENDANT’S MOTION TO DISMISS FOR FORUM NON CONVENIENS
Hon. Cathy Ann Bencivengo, United States District Judge
*1 This matter comes before the Court on Defendant’s motion to dismiss the complaint for forum non conveniens. [Doc. No. 7.] The motion has been fully briefed and the Court finds it suitable for determination on the papers and without oral argument. See S.D. Cal. CivLR 7.1(d)(1). For the reasons set forth below, Defendant’s motion to dismiss is granted.

I. BACKGROUND
On February 7, 2019, Plaintiff Indemnity Insurance Company of North America, Inc., filed a complaint for subrogation against Defendant Servicios Refrigerados Internacionales, S.A. de C.V. [Doc. No. 1.] The complaint alleges causes of action for: (1) Negligence; (2) Bailment; and (3) liability under the Carmack Amendment, 49 U.S.C. § 14706. [Id. at 5–8.]

Plaintiff is a corporation organized and existing under the laws of Pennsylvania. [Id. at ¶ 1.1] Defendant is a Mexican corporation with its principal place of business in Mexico. [Id. at ¶ 2.] According to the complaint, on or about February 7, 2018, Plaintiff’s insured, Driscoll’s, loaded a cargo of berries onto a delivery truck provided by Defendant at Zapopan, Jalisco, Mexico, to be delivered to Watsonville, California. [Id. at ¶ 7.] Driscoll’s contracted with Defendant for this carriage and delivery. [Id.] On or about February 8, 2018, while attempting to stop at a roadside check in Sonora, Mexico, Defendant’s truck driver failed to stop and struck a retaining wall, damaging the cargo of berries beyond saleable use. [Id. at ¶ 8.] Upon Plaintiff’s payment of the claim underlying Driscoll’s loss, Plaintiff claims it is now fully subrogated to Driscoll’s interest and brings this action against Defendant. [Id. at ¶ 17.] Plaintiff alleges that Defendant violated the terms of its carriage contract with Driscoll’s and became liable for the damages caused. [Id. at ¶ 10.]

On April 2, 2019, Defendant moved to dismiss for forum non conveniens. [Doc. No. 7.] Plaintiff filed its opposition [Doc. No. 8] on April 23, 2019, and Defendant filed its reply [Doc. No. 9] on April 30, 2019.

II. LEGAL STANDARD
The doctrine of forum non conveniens grants discretion to district courts to dismiss an action where “a court abroad is the more appropriate and convenient forum for adjudicating the controversy.” Sinochem Int’l Co. v. Malaysia Int’l Shipping Corp., 549 U.S. 422, 425 (2007). “To prevail on a motion to dismiss based upon forum non conveniens, a defendant bears the burden of demonstrating an adequate alternative forum, and that the balance of private and public interest factors favors dismissal.” Carijano v. Occidental Petroleum Corp., 643 F.3d 1216, 1224 (9th Cir. 2011). A plaintiff’s choice of forum is generally entitled to deference, especially where the plaintiff is a United States citizen or resident, because it is presumed a plaintiff will choose her “home forum.” See Piper Aircraft Co. v. Reyno, 454 U.S. 235, 255 (1981). This deference is “far from absolute,” however, and it is within the court’s discretion to decide whether a foreign forum is more convenient. Lockman Found. v. Evangelical Alliance Mission, 930 F.2d 764, 767 (9th Cir. 1991); see also Piper Aircraft, 454 U.S. at 255, n. 23 (“A citizen’s forum choice should not be given dispositive weight.”).

*2 The presumption in favor of the plaintiff’s choice of forum may be rebutted through a clear showing of facts that either: “(1) establish such oppressiveness and vexation to a defendant as to be out of all proportion to plaintiff’s convenience, which may be shown to be slight or nonexistent, or (2) make trial in the chosen forum inappropriate because of considerations affecting the court’s own administrative and legal problems.” Koster v. Lumbermens Mut. Cas. Co., 330 U.S. 518, 524 (1947); Cheng v. Boeing Co., 708 F.2d 1406, 1410 (9th Cir. 1983).

III. DISCUSSION

A. Carmack Amendment
Plaintiff’s opposition primarily contends that Defendant’s liability for the damage to the cargo is governed by the Carmack Amendment, 49 U.S.C. § 14706, and thus Defendant’s liability is to be determined under U.S. federal law, preventing transfer to a Mexican court. [Doc. No. 8 at 3–5.] Defendant contends the Carmack Amendment does not apply because it is silent as to shipments from a foreign country to the United States. [Doc. No. 9 at 3.] The Court first addresses whether the Carmack Amendment applies in this case.

The Carmack Amendment “codifies the common-law rule that a carrier, though not an absolute insurer, is liable for damage to goods transported by it unless it can show that the damage was caused by (a) the act of God; (b) the public enemy; (c) the act of the shipper himself; (d) public authority; (e) or the inherent vice or nature of the goods.” Missouri Pac. R.R. Co. v. Elmore & Stahl, 377 U.S. 134, 137 (1964); see 49 U.S.C. § 14706. With respect to motor carriers, the Carmack Amendment applies to the extent the property is transported between the points specified in 49 U.S.C. § 13501. With respect to a shipment involving a foreign country, the statute provides jurisdiction over motor carrier liability for transportation between “the United States and a place in a foreign country to the extent the transportation is in the United States.” 49 U.S.C. § 13501(1)(E) (emphasis added).

In Kawasaki Kisen Kaisha Limited v. Regal Beloit Corp., 561 U.S. 89 (2010), the Supreme Court held that “Carmack does not apply if the property is received at an overseas location under a through bill that covers the transport into an inland location in the United States.” Id. at 103 (emphasis added). In such a case, there is no receiving carrier that “receives” the property “for [domestic] transportation.” Id. However, the Court went on to note that this decision did not address “if Carmack applies to goods initially received in Canada or Mexico, for import into the United States.” Id. The jurisdictional reach of the Carmack Amendment “is determined by reference to 49 U.S.C. § 13501.” Project Hope v. M/V Ibn Sina, 250 F.3d 67, 74 (2nd Cir. 2001).

As noted above, U.S.C. § 13501(1)(E) specifically states, “to the extent the transportation is in the United States.” Consequently, if the alleged loss or damage to the cargo occurred during the domestic leg of the transportation in the United States, the Carmack Amendment would apply. See Reider v. Thompson, 339 U.S. 113, 117 (1950) (holding that the foreign portion of the transport terminated at the United States border, but the domestic leg of the transport fell within the purview of the Carmack Amendment). Here, the alleged loss or damage occurred entirely in Mexico. [Doc. 7-4 at 22, 24.] The transport never made it out of Mexico, and therefore under U.S.C. § 13501(1)(E), there is no domestic leg of the journey that falls within the purview of the Carmack Amendment. Accordingly, the Carmack Amendment does not apply in this case.

B. Adequate Alternative Forum
*3 An alternative forum is deemed adequate if: (1) the defendant is amenable to process there; and (2) the other jurisdiction offers a satisfactory remedy. See Piper Aircraft, 454 U.S. at 254, n. 22; Leetsch v. Freedman, 260 F.3d 1100, 1103 (9th Cir. 2001). It is only in “rare circumstances … where the remedy provided by the alternative forum … is so clearly inadequate or unsatisfactory, that it is no remedy at all,” that this requirement is not met. Piper Aircraft, 454 U.S. at 254, n. 22.

Here, Defendant has agreed to submit to the jurisdiction of a Mexican court, accept service of process issued by a Mexican court, and waive any defenses based on statute of limitations to facilitate the resolution of Plaintiff’s claims. [Doc. No. 7-1 at 12, Doc. No. 7-3 at ¶¶ 3–5.] Furthermore, Defendant contends a Mexican court has jurisdiction because the incident giving rise to Plaintiff’s claims occurred in Sonora, Mexico, the contract giving rise to Plaintiff’s claims was entered in Mexico and is explicitly governed by Mexican law, and both Defendant and Driscoll’s are incorporated in and principally located in Mexico.2 Defendant also contends that the remedy sought by Plaintiff for the value of cargo is equally available in a Mexican court through tort or contract. Defendant attached a declaration from a Mexican attorney who has been practicing law in Mexico since 1978 involving similar disputes who states, “the issues of liability and damages arising from this incident can be fully adjudicated by the Mexican courts with the appropriate jurisdiction for this dispute being the State of Sonora where the alleged incident occurred.” [Doc. No. 7-2 at ¶ 4.]

Plaintiff does not dispute that Defendant is amenable to service of process in Mexico but instead contends that Defendant’s liability falls under the Carmack Amendment and U.S. federal law. As discussed above, the Carmack Amendment does not apply, and Plaintiff is not precluded from seeking a similar remedy in Mexican court for the value of the cargo. Accordingly, Mexico is an adequate alternative forum.

C. Balance of Private and Public Interest Factors
The Court next addresses whether the private and public interest factors can rebut the presumption in favor of Plaintiff’s choice of forum. At the outset, the Court notes that Plaintiff is not a California corporation, but rather a Pennsylvania corporation and therefore Plaintiff’s choice of forum, while still given deference, will not be absolute. Plaintiff also fails to divulge where Driscoll’s is incorporated. It appears there is a Driscoll’s U.S.A. as well as a Driscoll’s Mexico. Defendant has shown that it contracted with Driscoll’s Mexico. Even if Driscoll’s U.S.A. is a California corporation, it was operating in Mexico through a Mexican corporation or subsidiary as Driscoll’s Operaciones, S.A. de C.V. “In an era of increasing international commerce, parties who choose to engage in international transactions should know that when their foreign operations lead to litigation they cannot expect always to bring their foreign opponents into a United States forum when every reasonable consideration leads to the conclusion that the site of the litigation should be elsewhere.” Mizokami Bros. of Ariz., Inc. v. Baychem Corp., 556 F.2d 975, 978 (9th Cir. 1977), cert. denied, 434 U.S. 1035 (1978).

*4 Private interest factors include “(1) relative ease of access to sources of proof; (2) the availability of compulsory process for attendance of hostile witnesses, and cost of obtaining attendance of willing witnesses; (3) possibility of viewing subject premises; (4) all other factors that render trial of the case expeditious and inexpensive.” Creative Tech., Ltd. v. Aztech Sys. Pte., Ltd., 61 F.3d 696, 703 (9th Cir. 1995). Public interest factors include “(1) administrative difficulties flowing from court congestion; (2) imposition of jury duty on the people of a community that has no relation to the litigation; (3) local interest in having localized controversies decided at home; (4) the interest in having a diversity case tried in a forum familiar with the law that governs the action; (5) the avoidance of unnecessary problems in conflicts of law.” Id. at 703–04.

1. Private Interest Factors
As to the ease of access to sources of proof and availability of witnesses, Defendant contends that all the material witnesses are in Mexico, including Defendant, Driscoll’s Mexico, Defendant’s driver from the incident, percipient witnesses to the incident, the Mexican police who responded to the incident, witnesses related to the loading and disposition of the cargo, and witnesses to the contract between Plaintiff and Defendant. [Doc. No. 7-1 at 15.] Furthermore, Defendant contends that any third-party defendant who may be liable under principles of contribution or indemnity is virtually guaranteed to be in Mexico and not subject to personal jurisdiction in California. [Id. at 16.] Plaintiff contends that the real issue in this case is the legal liability of a carrier whose U.S. headquarters is in San Diego which can only be established using testimony of witnesses residing within California. [Doc. No. 8 at 5.] Plaintiff also contends that Defendant’s president and relevant witnesses concerning the establishment of the contract are in California and liability is not an issue so there are no relevant premises to review. [Id.] Defendant does not indicate that liability is not at issue, and its potential need for percipient witnesses to the incident or for seeking contribution from a third-party suggests otherwise.

The Court is not persuaded that because Defendant receives mail in San Diego or that its president executed her declaration in Chula Vista that this disqualifies the potential need for the numerous other material witnesses to the incident cited to by Defendant who are in Mexico.3 Moreover, a corporate officer who has contact with a forum only with regard to the performance of his official duties is not subject to personal jurisdiction in that forum. See Chem Lab Products, Inc. v. Stepanek, 554 F.2d 371 (9th Cir. 1977). A Mexican court should have no issue haling into court the president of a Mexican corporation for testimony in Mexico as Plaintiff suggests. Plaintiff also does not oppose Defendant’s contention that Driscoll’s with whom Defendant contracted is a Mexican corporation or subsidiary. The Court does not find that addressing which documents cited to by Plaintiff and Defendant that are at issue in this case, if any, will be determinative of a different outcome and both parties appear in dispute on this issue.4 Nevertheless, the Federal Motor Carrier Safety Administration document Plaintiff cites to indicates Defendant’s business address is in Mexico, and the Regulation for Transport Providers document is signed by an entity Defendant is not affiliated with. [Doc. No. 8-2 at 2; Doc. No. 8-4 at 4.]

*5 As to enforceability of judgment, Defendant contends that Plaintiff can seek to enforce a Mexican judgment in the United States. Plaintiff contends the proper standard under this element is whether Defendant has assets which would satisfy a Mexican judgment but offers no legal authority on this point. Defendant has not disclosed any information establishing assets to satisfy a judgment. Defendant’s contentions that Plaintiff would have no difficulty enforcing a Mexican judgment in the United States does not compel the Court to presume Defendant does or does not have sufficient assets. Therefore, this factor does not favor either side.

Although the mere fact that this case involves conduct that occurred outside this forum is not enough for dismissal, the fact that all relevant conduct took place in Mexico bolsters the Court’s confidence that key witnesses and physical evidence are in Mexico. See Loya v. Starwood Hotels & Resorts Worldwide, Inc., 583 F.3d 656, 659 (9th Cir. 2009) (holding that dismissal for forum non conveniens was appropriate where plaintiff was a resident of the forum state, but all alleged conduct took place in Mexico); see also Contact Lumber Co. v. P.T. Moges Shipping Co. Ltd., 918 F.2d 1446, 1451 (9th Cir. 1990) (affirming the District Court’s dismissal for forum non conveniens where plaintiff was an American corporation, but evidence and witnesses were located in the Philippines).

Accordingly, considering the location of the evidence on liability issues, the inherent difficulty of bringing hostile witnesses before the U.S. courts, and the potential inability to implead third-party defendants, the balance of private interest factors weighs in favor of dismissal.

2. Public Interest Factors
Plaintiff has offered no argument that the public interest factors weigh against dismissal and no opposition to Defendant’s contentions that they weigh in favor of dismissal. Defendant contends that the time and resources this Court would spend on this case are better spent elsewhere as this case belongs in Mexico. “Administrative difficulties follow for courts when litigation is piled up in congested centers instead of being handled at its origin.” Gulf Oil Corp. v. Gilbert, 330 U.S. 501, 508 (1947). The Court agrees that reasonable steps to reduce court congestion should be taken and this case should properly be handled at its origin in Mexico. The Court cannot justify burdening California jurors to try a case that has little to nothing to do with California.

*6 With respect to the local interest factor Defendant contends that California and the U.S. have little, if any, local interest in deciding this matter compared to Mexico. The local interest factor looks to whether there is “an identifiable local interest” in this forum. Tuazon v. R.J. Reynolds Tobacco Co., 433 F.3d 1163, 1182 (9th Cir. 2006). The interest of the foreign forum can also be relevant. See Loya, 583 F.3d at 665 (affirming a decision that found that Mexico’s interest in a case outweighed the forum state’s interest). While California and the U.S. have an interest in providing its corporations a proper forum to resolve liability disputes, that interest is weakened here where Plaintiff is not a California corporation and Driscoll’s is a multinational corporation which was operating in Mexico and contracted with Defendant which is a Mexican corporation. The subject incident took place in Mexico and material proof and witnesses regarding liability are mostly, if not all, in Mexico. As discussed above, there is little to no connection with the subject incident and California and either parties’ principal place of business. Therefore, the local interest factor weighs in favor of litigating this case in Mexico.

As to the familiarity with the governing law factor, Defendant contends that the contract which forms the basis of Plaintiff’s complaint calls for application of Mexican law, and even if it did not a Mexican court analyzing this matter would still apply Mexican law. [Doc. No. 7-1 at 20.] The Ninth Circuit has held that “[b]efore dismissing a case for forum non conveniens, a district court must first make a choice of law determination.” Zipfel v. Halliburton Co., 832 F.2d 1477, 1482 (9th Cir. 1987), amended on other grounds by 861 F.2d 565 (9th Cir. 1988). However, the choice of law analysis is only determinative when the case involves a United States statute requiring venue in the United States. See Creative Tech., 61 F.3d at 700. Where no such law is implicated, the choice of law determination is given much less deference on a forum non conveniens inquiry. Since “there is no arguably applicable law that would end the forum non conveniens inquiry [in this case], … no potentially dispositive choice of law determination need have been made.” See Gemini Capital Group, Inc. v. Yap Fishing Corp., 150 F.3d 1088, 1092 (9th Cir. 1998) (“This case does not implicate any United States law which mandates venue in the United States district courts. Consequently, the applicability of United States law to the various causes of action ‘should ordinarily not be given conclusive or even substantive weight.’ ”) (quoting Piper Aircraft, 454 U.S. at 247). The Court discussed above that the Carmack Amendment does not apply here, which was Plaintiff’s primary opposition. Plaintiff’s other claims do not mandate venue in the United States and therefore a dispositive choice of law determination need not be made here.

After considering the private and public interest factors discussed above, and in light of Plaintiff’s failure to offer any opposition to the public interest factors, the Court is persuaded that these factors support dismissing this matter because Mexico is the more appropriate forum and any convenience to Plaintiff’s choice of forum here is slight or nonexistent.

IV. CONCLUSION
Based on the above, the Court GRANTS Defendant’s motion to dismiss for forum non conveniens and Plaintiff’s complaint is DISMISSED.

It is SO ORDERED.

All Citations
Slip Copy, 2019 WL 2269948

Footnotes

1
Document numbers and page references are to those assigned by CM/ECF for the docket entry.

2
The contract attached to Defendant’s motion at Exhibit 1 indicates that Driscoll’s Operaciones, S.A. de C.V., a Mexican corporation, is the signatory to the contract with Defendant. [Doc. No. 7-4 at 21.]

3
The Federal Motor Carrier Safety Administration document attached as Exhibit 1 to Plaintiff’s opposition lists Defendant’s business address at: Transportistas Num 407, Leon, GJ 37290. [Doc. No. 8-2 at 2.]

4
Accordingly, Defendant’s objection to evidence [Doc. No. 9-2] is denied as moot.