United States District Court,
S.D. New York.
J.R.J. ENTERPRISES, INC., Plaintiff,
v.
M/V CCNI CARTAGENA, her engines, boilers, etc. and Compania Sub-Americana De Vapores, S.A., Defendants.
No. 08 Civ. 3473(GBD).
Dec. 29, 2010.
MEMORANDUM DECISION AND ORDER
GEORGE B. DANIELS, District Judge.
Plaintiff J.R.J. Enterprises purchased 1,080 boxes of fresh green plantains from an undisclosed supplier. Compl. ¶ 5. Defendant Compania Sub-Americana De Vapores, S.A. (“CSAV”) is the shipper and Defendant M/V CCNI Cartagena (“Cartagena”) is the ship upon which the plantains were transported. See Compl. ¶¶ 3-4. Plaintiff alleges that the plantains were delivered to the ship in good condition but arrived in “damaged and chilled or frozen condition.” Compl. ¶¶ 5, 7. Plaintiff does not allege how or why the goods were damaged during shipment; rather, it simply asserts that the goods arrived frozen. See id. On March 12, 2010, CSAV moved for summary judgment contending that Plaintiff failed to establish that the cargo was damaged while in its custody or, in the alternative, that CSAV exercised reasonable care in handling the produce. Further, CSAV sought summary judgment on its counterclaim for breach of an unrelated Bill of Lading against J.R.J. While the motion was pending, Plaintiff and Defendants were engaged in settlement talks with the assistance of a mediator. Those talks fell apart. In the meantime, Plaintiff never responded to Defendant’s motion nor requested that this Court stay the proceedings while settlement talks were ongoing.
My chambers contacted Plaintiff’s counsel several times to inquire whether Plaintiff intended to respond to the motion. Plaintiff’s counsel did not seek an opportunity to submit a written response, nor did he otherwise respond to the court’s inquires.
Facts
On March 27, 2007, Ramzy Export-Import Compania Limitada, not a party to this litigation, delivered approximately 1,000 boxes of fresh green plantains to the Cartagena. Compl. ¶ 5; Tagliareni Decl. Ex. D at 1. The goods were to be shipped from Ecuador to New York City. Id. J.R.J. Enterprises was the consignee of the goods. Id. The goods arrived in New York City on April 11, 2007. Compl. ¶ 6; Tagliareni Decl. Ex E.
The goods were identified by Bill of Lading number CHIW 27A057286. Tagliareni Decl. Ex. D at 1. The Bill of Lading indicates that the goods were stowed, counted and sealed by the shipper, which implies that CSAV did not have an opportunity to inspect the goods upon delivery. See id. Upon delivery to the ship, the “set temperature” of the container was noted as 7.22 Degree Celsius or 45 degree Fahrenheit. Id. In a section labeled “Particulars Furnished by Shipper-Carrier not responsible,” it is noted that “Container received with return temperature of 7.9 Degrees Celsius [sic] Carrier’s obligation is limited only to maintain the setting air temperature of 7.22 Degrees Celsius as per shipper / receivers wri [sic] instruction, condition, and quality unknown.” Id. Ex. D at 2.
The terms and conditions of shipment, incorporated by reference into the Bill of Lading, provide:
If perishable Goods requiring special temperature are delivered to the Carrier in a refrigerated container, the Merchant undertakes that the Goods have the temperature provided on the face hereof and that they have been properly stowed and the thermostatic controls have been properly set before delivery of the Goods to the Carrier. The Merchant agrees that when a temperature is noted on the face hereof … the Carrier will exercise reasonable care to maintain the ambient temperature in the refrigerated chamber or container plus or minus 2°C. In no event shall the Carrier be liable in any respect because heating, refrigeration or special cooling facilities are not furnished during loading, discharge or any part of the time that the Goods are on a dock, wharf, craft or other loading or discharging place.
Id. at ¶ 12.
According to the temperature data from the container, the air supplied into the container was around 7°C for most of the voyage. See id. Ex. E; Ex. I. However, when the container was delivered to the ship the temperature inside the container was approximately 25°C and it took until April 5, or roughly nine days, for the temperature inside the container to reach approximately 7°C. The only time the temperature was not set at 7.25°C was when the power to the container was off. See id. Ex. E at 9, 26. The container’s power was never off for more than a few hours. See id.
On April 20, J.R.J. Enterprises sent a notice of claim to CSAV and requested a U.S. Department of Agriculture inspection. Id. Exs. G, H. The USDA conducted its inspection on April 24 and noted that there was “decay, checksum and dark brown to black discoloration following chilling.” See id. Ex. H at 1. The inspector noted that the discoloration affected between 50% and 100% of the goods. Id. CSAV also commissioned an inspection of the container. See id. Ex. I. The inspector examined the container on April 23, 2007. Id. After examining the shipment and collecting the data from the container, the inspector concluded that
it is apparent that the shipment suffered some form of temperature abuse, however based on the data extracted from the container in question, any abuse should be excluded whilst the shipment was housed within the confines of the container finding its operation without apparent exception during transit. Noting an approximate ten (10) day period for which it took the shipment to return to temperatures within that of the set points is an indication that the shipment was not pre-cooled prior to stuffing noting the container was supplying the requested temperature at the time of it powering up.
Id. at 3.
Summary Judgment Standard
Summary judgment is appropriate where the evidence, viewed in the light most favorable to the non-moving party, shows “that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.” FED. R. CIV. P. 56(c); Vacold, L.L.C. v. Cerami, 545 F.3d 114, 121 (2d Cir.2008). The burden rests upon the moving party to show that there is no genuine issue of material fact. See Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 (1986). A fact is “material” only where it will affect the outcome of the suit under governing law. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). For there to be a “genuine” issue about the fact, the evidence must be such “that a reasonable jury could return a verdict for the nonmoving party.” Id. In determining whether there is a genuine issue of material fact, the Court is required to resolve all ambiguities and draw all inferences in favor of the non-moving party. Sec. Ins. Co. of Hartford v. Old Dominion Freight Line, Inc., 391 F.3d 77, 83 (2d Cir.2004). Where there is no evidence in the record “from which a reasonable inference could be drawn in favor of the non-moving party on a material issue of fact,” summary judgment is proper. Catlin v. Sobol, 93 F.3d 1112, 1116 (2d Cir.1996).
Plaintiffs failure to respond to Defendant’s motion does not require that summary judgment be automatically entered against it. The Second Circuit has held that “even when a nonmoving party chooses the perilous path of failing to submit a response to a summary judgment motion, the district court may not grant the motion without first examining the moving party’s submission to determine if it has met its burden of demonstrating that no material issue of fact remains for trial.” Amaker v. Foley, 274 F.3d 677, 681 (2d Cir.2001). If Defendant has not met its burden then summary judgment must be denied “even if no opposing evidentiary matter is presented.” Vermont Teddy Bear Co., Inc. v. 1-800-Beargram Co., 373 F.3d 241, 244 (2d Cir.2004) (citation omitted).
This Court has jurisdiction over this matter pursuant to 28 U.S.C. § 1333(1) because the alleged damages occurred on navigable waters and arise from traditional maritime activity. See Jerome B. Grubart, Inc. v. Great Lakes Dredge & Dock Co., 513 U.S. 527 (1995); Vasquez v. GMD Shipyard Corp., 582 F.3d 293, 298 (2d Cir.2009). Further, the Carriage of Goods by Sea Act (“COGSA”) governs this dispute as one between a carrier and a shipper. Sam Jin World Trading, Inc. v. M/V Cap San Nicolas, 2010 U.S. Dist. LEXIS 65953 at(S.D.N.Y.2010). To establish a prima facie case under COGSA, the plaintiff has the burden of proving that the goods were damaged while in defendant’s custody. Caemint Food, Inc. v. Brasilerio, 647 F.2d 347, 351-352 (2d Cir.1981); Sam Jin World Trading, Inc. v. M/V Cap San Nicolas, 2010 U.S. Dist. LEXIS 65953 at(S.D.N.Y.2010); J.R.J. Enterprises, Inc. v. M/V Cap Ortegal et al., 2009 U.S. Dist. LEXIS 55769 at(S.D.N.Y.2009). A plaintiff can satisfy this burden by either proffering evidence that the goods were in good condition upon receipt by the shipper and damaged when they arrived in port or by proving that the nature of the damage to the cargo demonstrates that the damage occurred while in transport. Caemint Food, 647 F.2d at 351; Hershey Foods Corp. v. Waterman S.S. Corp., No. S2 Civ. 0533, 1994 U.S. Dist. LEXIS 8371, 1994 WL 281929, at(S.D.N.Y. June 22, 1994) (citing Kanematsu Gosho Ltd. v. Messiniaki Aigli, 814 F.2d 115, 118 (2d Cir.1987)). A clean Bill of Lading typically satisfies this burden except, “courts have long recognized that it does not have this probative force when … the shipper seeks to recover for damages to goods in packages that would have prevented the carrier from observing the damaged condition had it existed when the goods were loaded. Caemint Food, 647 F.2d at 352; J.R.J. Enterprises, 2009 U.S. Dist. LEXIS 55769 at *9. If a plaintiff has made out a prima facie case, the burden shifts to defendants to show that one of the statutory exceptions to liability exist. Bally, Inc. v. M.V. Zim America, 22 F.3d 65, 69 (2d Cir.1994).
Here, Plaintiffs have not offered any evidence demonstrating that the goods were damaged while in Defendant’s custody. The goods were delivered to Defendants in a container that was sealed by another independent party. Thus, the clean Bill of Lading does not satisfy plaintiff’s burden of proving that the goods were in good condition before Defendant had custody. See Caemint Food, 547 F.2d at 352. Further, as the Bill of Lading makes clear, Defendant’s only obligation was to maintain a set temperature within a 2° range of 7°C. Tagliareni Decl. Ex D at ¶ 12. The cooling data records from the container and the inspector’s report submitted by Defendants further establish that Defendant satisfied this obligation for the entire time the goods were on the ship. See id. Exs. E, I. Thus the evidence does not support a conclusion that the damage was due to improper temperature storage, which occurred while the goods were in Defendants possession.
Further, Plaintiff has not established that the goods were damaged before they were outturned, or when they left the ship’s possession. The point of outturn is not fixed but occurs when the containers are delivered to plaintiff’s agent at the terminal. Bally, Inc., 22 F.3d at 69 (citing Nissho-Iwai Co. v. M.T Stolt Lion, 719 F.2d 34, 38 (2d Cir.1983)). Further, under the terms of the Bill of Lading. Defendant was not responsible for maintaining the temperature of the container once it was discharged from the ship. See Tagliareni Decl. Ex E at ¶ 12.
Here, the container was discharged on April 11, when it arrived in New York City. Plaintiff did not file its notice of loss until April 20, despite receiving notice of the ship’s impending arrival on April 4. Therefore, Plaintiffs have not met their initial burden of providing evidence indicating that the goods were damaged before outturn. Further, once the container left the ship’s custody, the container was disconnected from its power supply and the proper internal temperatures was not maintained. See Tagliareni Deck Ex. E, I. The record does not demonstrate who had custody over the container once it left the vessel, but the Bill of Lading makes clear that Defendants were not responsible for maintaining the container’s temperature once the container left the ship. See id. Ex. D at § 9 (“the Carrier shall be under no liability whatsoever for loss or damage to the Goods .. when such loss or damage arises .. subsequent to the discharge from the Vessel). Because Plaintiff has not met its burden of establishing that the plantains were damaged while the goods were in the defendant’s custody summary judgment is appropriate. See J.R.J. Enterprises, 2009 U.S. Dist. LEXIS 55769 at *9.
Breach of Contract Counterclaim
In its Answer, CSAV counterclaimed pursuant to Fed.R.Civ.P. 13(b) for breach of contract against Plaintiff for failure to pay an outstanding invoice totally $5.100 for an unrelated shipment of plantains in 2008. CSAV now moves for summary judgment to recovery this money. This Court has subject matter jurisdiction over this contract claim pursuant to its admiralty jurisdiction. 28 U.S.C. § 1333(1); Norfolk Southern Railway Co. v. Kirby, 543 U.S. 14, 22-23 (2004).
While Plaintiff responded to Defendant’s counterclaim and denied having knowledge or information sufficient to form a belief as to Defendant’s counterclaim, it cannot rely on its general denial in its pleading on a motion for summary judgment. See J.R. Enterprise, 2009 U.S. Dist. LEXIS 55769, at *11.
Ocean freight charges are due upon delivery even if the shipper or consignee claims that the goods have been lost, damaged or delayed during transit. Metallgesellcraft A.G. v. M/V Captain Constante, 790 F.2d 280, 282-83 (2d Cir.1986); Maersk, Inc v. Royal Brands Int’l, 2001 U.S. Dist. LEXIS 5308 at(S.D.N.Y.2001).
Here, Defendant proffered evidence that Plaintiff abandoned the cargo after it had arrived in New York, that Plaintiff refused to pay for the cargo and Defendant settled the demurrage fee for $1,000. See Tagliareni Decl. Ex. J. This is sufficient evidence to meet Defendants’ prima facia burden. See J.R.J Enterprise, 2009 U.S. Dist. LEXIS 55769, at *11. Therefore, this Court grants summary judgment on Defendant’s breach of contract counterclaim. See id.
Conclusion
Defendant’s Motion for Summary Judgment is granted. Plaintiffs complaint is dismissed. Judgment in the amount of $5,100 is entered in favor of Defendant against Plainitff on Defendants’ counterclaim.
