term "contract of carriage” includes only those
"contracts of carriage covered by a bill of lading or
any similar document of title, insofar as such document
relates to the carriage of goods by sea, including any
bill of lading or any similar document as aforesaid
issued under or pursuant to a charter party from the
moment at which such bill of lading or document of
title regulates the relations between a carrier and a
holder of the same.” Id. §1301(b). COGSA expressly
does not apply to charter parties, except that bills of
lading issued under charter party agreements must
conform to the terms of COGSA. Id. §1305. Thus, COGSA
is applicable to a shipowner that has chartered its
vessel to a COGSA carrier only when the shipowner has
entered into a contract of carriage with the shipper or
has some privity of contract with the shipper.

As noted by the Fourth Circuit, "[a] contract of
carriage with an owner may either be direct between the
parties, or by virtue of a charterer's authority to
bind the owner by signing bills of lading 'for the
master.'” Generally, when a bill of lading is signed
by the charterer or its agent "for the master" with the
authority of the shipowner, this binds the shipowner
and places the shipowner within the provisions of
COGSA. When, however, a bill of lading is signed by
the charterer or its agent "for the master” but without
the authority of the shipowner, the shipowner is not
personally bound and does not by virtue of the
charterer's signature become a COGSA carrier.

EAC Timberlane, id. then went on to say:

In the instant case, the district court did not
determine whether the bill of lading was signed by the
charterer "for the master” with the authority of the
shipowner so as to place the shipowner under the terms
of COGSA.
Here this Court is similarly unable to make such a determination
in any definitive fashion. Although Commander has persuasively
negated its having granted actual authority to sign unconditional

bills of lading, this Court has not been provided by the parties



decision there, which nonetheless rejected in personam

jurisdiction over the owner, is essentially on all fours

with this case.

2. ASARCO, 912 F.2d at 786 did say that the signature
of the entity that signed the bill of lading as agent (the
counterpart of Statu in this case) was “apparently...on
behalf of one of the charterers.” That might be argued to
lessen the precedential force of that decision, because in
this case there was a specific delegation of authority to
the Vessel’s Captain in the Time Charter documents. But be
that as it may, it remains true that in this case, just as
was said in ASARCO, id. at 787, Commander itself did not
“purposefully direct” the cargo to Chicago.

Just a word should be added about Sompo’s alternative
request for discovery, to explore the possibility that general
jurisdiction rather than special jurisdiction might perhaps
support haling Commander into this Illinois forum. On that
score, even if it were to be demonstrated that one or more
charter parties, operating under Time Charter documents over a
span of time, had contracted for voyages having Illinois
destinations chosen by the charter parties and not by Commander,
the result would be the same: After all, the addition or even
multiplication of zeros produces the same zero result. Sompo’s

motion in that respect, advanced without anything other than


emphasizes the terms by which Additional Clause 62 to the Charter
party expanded on that provision:

With reference to Lines 78/79 of Charter Party,

Charterers and/or their agents are hereby authorised by

owners to sign on Master’s and/or Owners’ behalf all

Bills of Lading as presented in accordance with Mate’s

and Tally Clerk’s receipts without prejudice to this

Charter Party.

For its part Commander stresses the last phrase of that
provision--“without prejudice to this Charter party”--to urge
that Statu as Brochart’s agent exceeded its conditional authority
by preparing and signing bills of lading that named “Commender”
as the carrier, but without inserting appropriate limiting
language to reflect that it was Brochart, and not Commander at
all, that was in complete control of the Vessel, of what it did
and of where it went.

It is against that background that the current motion must
be addressed. And to that end, although each party has cited to
a number of cases, both at the Court of Appeals and at the
District Court level, a few of the Court of Appeals decisions
relied on by Commander provide the answer here.

First is the decision in EAC Timberlane v. Pisces, Ltd., 745
F.2d 715 (1%* Cir. 1984). There the late Judge John Minor Wisdom
of the Fifth Circuit, sitting by designation, explained for the
panel (id. at 719 (numerous case citations omitted) ):

By its terms, COGSA applies "to all contracts for

carriage of goods by sea to or from ports in the United
States in foreign trade.” 46 U.S.C. §1312 (1982). The

3


with the necessary information to resolve the alternative to
actual authority--to decide whether the factual scenario involved
enough in the way of a “holding out” on Commander’s part to
support a finding of apparent authority, or conversely whether
the existence of a time charter with its usual limitations, or
perhaps of other relevant factors, was known by the shipper to
the extent that would preclude such an apparent authority ruling.
But that question, which bears on Commander’s possible
liability and not on the issue of in personam jurisdiction that
is now before this Court, need not be answered here--for even if
it were to be assumed that Commander’s listing as carrier did
render it subject to potential liability, two cases from other
circuits make it plain that such personal jurisdiction is lacking
here anyway. Both Francosteel Corp. v. M/V Charm, 19 F.3d 624,
627-29 (11 Cir. 1994) and ASARCO, Inc. v. Glenara, Ltd., 912
F.2d 784, 785-87 (5** Cir, 1990) are sufficiently close to this
case so that an extended quotation from each opinion
(particularly with an appropriate substitution of names) would
reflect an analysis that might well have been written for this
case. And although the situation addressed by our own Court of
Appeals in United Rope Distribs., Inc. v. Seatriumph Marine
Corp., 930 F.2d 532 (7% Cir. 1991) was not quite so parallel to

1 EAC Timberlane did not speak to that issue at all, for
the question was not in dispute there.

5


speculation,” amounts to nothing more than a proposed fishing
expedition seeking to operate from a vessel that is suited to
commercial voyages and not to angling.

Conclusion

For the reasons set out in this opinion, Commander is

dismissed as a defendant pursuant to Rule 12(b)(2). That renders
moot its motion challenging, as noncompliant with Rules 4(f) (2)
and 4(h) (2), the method employed by Sompo to serve process on

Commander. As for the Vessel, it remains an in rem defendant.

Ce Mba Gu dur

Milton I. Shadur
Senior United States District Judge

Date: August 4, 2004

2? Captain Dimitris Karagiorgis, who is Operations Manager

of Kristen Marine, S.A. (identified as the Vessel’s managers),
has said this in his June 10, 2004 declaration in support of
Commander’s motion to dismiss (Decl. 116-7):

6. Commander Navigation Co. is a foreign corporation
that does not maintain any offices in the United States, nor
any employees, telephone listings or designated agents in
any state in the United States. The company has not engaged
in any business activities in the State of Illinois.

7. Commander Navigation Co. has not engaged in any
purposeful activity within the State of Illinois.

Nothing whatever has been advanced by Sompo to cast any doubt on
those representations.



4. Mimate Onder Form (06/97)

United States District Court, Northern District of Illinois

Name of Assigned J i iting Judge if Oth
roe Magistrate Judge Milton I. Shadur “than Anigned Judge
CASE NUMBER 03 C 7770 DATE 8/4/2004
CASE Sompo Japan Insurance ys. M/V Commander, et al
TITLE

[in the following box (a) indicate the party filing the motion, e.g,, plaintiff, defendant, 3rd party plaintiff, and (b) state briefly the nature
of the motion being presented.}

MOTION:

DOCKET ENTRY:

ql) a Filed motion of [ use listing in “Motion” box above.]

Q) Qo Brief in support of motion due

@) oO Answer brief to motion due. . Reply to answer brief due.

(4) Qo Ruling/Hearingon__setfor__at

(5) Oo Status hearing{held/continued to] [set for/re-set for]on___setfor____—_at

©) o Pretrial conference[held/continued to] [set for/re-setfor]on__—_—ssetfor__——at__

(©) a] Trial[set for/re-set for]on__—_aat

(8) oO [Bench/Jury trial] [Hearing] held/continuedto__at

(9) oO This case is dismissed [with/without] prejudice and without costs[by/agreement/pursuant to]
OOFRCP4(m) (ClLocalRule 41.1 COFRCP41(a)\(1) CFRCP41(a)(2).

ao [Other docket entry] | Enter Memorandum Opinion and Order. For the reasons set out in this

opinion, Commander is dismissed as a defendant pursuant to Rule 12(b)(2). (19-1) That renders moot its
motion challenging, as noncompliant with Rules 4(f)(2) and 4(h)(2), the method employed by Sompo to
serve process on Commander. As for the Vessel, it remains an in rem defendant.

(ii) [For further detail see order attached to the original minute order.]

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the present factual situation as those in the other two cited
cases, the thrust of its analysis would also tend to support the
same result.

It is quite true that the vessel in each of those three
cases-~Francosteel, ASARCO and United Rope~-sank before reaching
its forum destination, while the voyage in this case was
completed. But it is plain from the discussion in each of those
opinions that the nonarrival at the ultimate destination was only
an additional straw added to an already overburdened
jurisdictional camel--and net the straw that broke the camel’s
back.

Sompo’'s Mem. 8 unpersuasively seeks to dismiss Francosteel
and ASARCO as “inapposite.” But as just stated, the sinking of
the vessels in those cases--while admittedly presenting a factual
matrix different to that extent from the one involved here--was
plainly not viewed as outcome-determinative (on a but-for basis)
by either Court of Appeals. So the fact that the Vessel and the
cargo in this case were successful in reaching Chicago is a
distinction without a legal difference. And as for the issue of
authority or lack of authority that was posed in EAC Timberlane
(but was not answered by the District Court there, and hence was
not answered by the Court of Appeals either):

1. Erancosteel, 19 F.3d at 627 assumed that the

vessel’s owner was bound by the bills of lading. So the


IN THE UNITED STATES DISTRICT COURT KETE,
FOR THE NORTHERN DISTRICT OF ILLINOIS AUg “6
EASTERN DIVISION 2004.

SOMPO JAPAN INSURANCE COMPANY
OF AMERICA,

Plaintiff,

)
)
)
)
)
v. ) No. 03 C 7770
)
M/V COMMANDER, et al., )

)

)

Defendants.
MEMORANDUM OPINION AND ORDER

One of the. several defendants in this admiralty action,
Commander Navigation Co., Ltd. (“Commander,” mistakenly named as
‘“Commender” in the Complaint), has moved to be dismissed for lack
of personal jurisdiction and insufficiency of service. Counsel
for plaintiff Sompo Japan Insurance Company of America (“Sompo”)
and for Commander have provided this Court with input that,
although it does not permit the resolution of all legal questions
involved (as explained hereafter), nonetheless suffices for the
decision of the motion. This memorandum opinion and order
explains why Commander prevails on the first facet of its motion,
rendering the second facet moot.

Commander is owner of the vessel M/V Commander (the
“Vessel”), which is an in rem defendant in this action. Sompo
provided insurance to cover some steel cargo that was shipped
aboard the Vessel from Gemlik, Turkey to Chicago and that was
assertedly damaged at some point between (1) the original

delivery of the cargo to a carrier at the point of origin and


(2) the ultimate delivery of the cargo in Chicago. But at the
time of the voyage the Vessel was subject to a maritime time
charter party between Commander and Brochart KB (“Brochart”),
which under the terms of the Time Charter documentation was made
solely responsible for the Vessel’s direction and control,
including the decisions to undertake the voyage and to direct the
Vessel to Chicago.

Because it is undisputed that Commander played no direct
role in connection with the cargo or the Vessel’s voyage that
would support personal jurisdiction here, Sompo has to stake its
jurisdictional bet on the fact that both the marine and ocean
bills of lading referred to “Commender” as the carrier, listing
Commander’s address in Malta (it is indeed a Maltese corporation
and has its principal place of business there). As might be
guessed from the misspelling of its name, it was not Commander
that prepared the bill of lading--that was done instead by Statu
Chartering & Trading Ltd. (“Statu”) of Istanbul, Turkey, which
was Brochart’s loading port agent and which signed the bills of
lading “as agent on behalf of the carrier.”

Under the terms of the charter party (which adapted the
printed form of Time Charter approved by the New York Produce
Exchange), “the Captain...is to sign Bills of Lading for cargo as
presented, in conformity with Mate’s and Tally Clerk’s receipts”

(lines 78-79 of the printed Time Charter form). And Sompo