Opinion ID: 584154
Heading Depth: 1
Heading Rank: 5

Heading: extension of the himalaya clause to maher

Text: 45 SPM seeks to hold the negligent Maher liable in tort for the full amount of damage ($228,000), while Maher claims to be a third-party beneficiary of a clause in the Yangming bill of lading that confers Yangming's defenses (including the $500 COGSA default limitation) on stevedores. SPM's final contention on appeal is thus that Maher's liability should not have been limited to $500 because Maher was not entitled to any of the liability limitations in the bills of lading. 46 The Supreme Court has interpreted COGSA to provide for damage limitations for the carrier and the ship, not for stevedores or other third parties involved in the handling of cargo. See Robert C. Herd & Co. v. Krawill Machinery Corp., 359 U.S. 297, 79 S.Ct. 766, 3 L.Ed.2d 820 (1959). At the same time, however, the Court also suggested that carriers could contractually extend their liability limitation to their employees, agents, and independent contractors, 359 U.S. at 302, 305, 79 S.Ct. at 769, 771, although such provisions, being in derogation of the common law of torts, are to be strictly construed and limited to intended beneficiaries, 359 U.S. at 305, 79 S.Ct. at 771. Carriers now typically include such liability limitation extension clauses in their form contracts, provisions that are generally known as Himalaya clauses. 8 47 The question here is whether Maher was protected by a Himalaya clause. The limitations on Maher's liability are determined under the Yangming bill of lading. 9 Paragraph 3 of that bill reads: 48 EXEMPTIONS AND IMMUNITIES OF SERVANTS, AGENTS, STEVEDORES, ETC.--In contracting for the following exemptions and limitation of and exoneration from liability, the Carrier is acting as agent and trustee for all other persons named in this clause. 49 It is understood and agreed that, other than the Carrier, no person, firm or corporation or other legal entity whatsoever (including ... stevedores ...) is, or shall be deemed to be liable with respect to the Goods as carrier, bailee or other whosoever. If, however, it shall be adjudged that any other than the Carrier is carrier or bailee of the Goods or under any responsibility with respect thereto, all exemptions and limitations of and exoneration from liability provided by law or by terms hereof shall be available to such other. 50 It is also agreed that each of these persons and companies referred to above are intended beneficiaries.... 51 (emphasis added). 52 This provision was rather inartfully drawn, but nevertheless clearly extends all liability limitations in the bill of lading to stevedores, who are expressly denominated intended beneficiaries of the contract. SPM concedes, as it must, that some stevedores are intended beneficiaries. Rather, it argues that Maher was not an intended beneficiary of the contract because it was not performing services in furtherance of the transport of SPM's cargo, but instead was unnecessarily restowing it to make room for unrelated cargo. In SPM's view, the removal and restowage of SPM's cargo at an intermediate port was not a service contemplated in the Yangming bill of lading. 53 We will assume without deciding that SPM is correct that the Himalaya clause only applies to stevedores' actions taken in furtherance of the contract, rather than, as the district court held, to all actions by all stevedores who handle the cargo for any purpose whatsoever. Even so, we think it plain that Maher's stevedores were handling SPM's cargo in furtherance of the Yangming bill of lading. As noted above, the district court found that restowage of cargo at intermediate ports in order to take on additional cargo is commonplace. SPM has offered us no basis to declare that finding clearly erroneous. We therefore conclude that the Yangming bill of lading contemplated cargo handling by stevedores not only during original loading and eventual final discharge, but also at intermediate ports. 54 The restowage of SPM's cargo was, according to the district court's findings, typical in that it was done to take on additional cargo and to relocate SPM's cargo to a more convenient location for final discharge. Maher's actions were therefore done in furtherance of the Yangming bill of lading, and, by virtue of the Himalaya clause therein, Maher is entitled to the benefit of the $500 per package damage limitation of COGSA. 10