Opinion ID: 74611
Heading Depth: 2
Heading Rank: 2

Heading: Polo's Standing to Bring a COGSA Claim

Text: In its motion for partial summary judgment, Tropical sought judgment on Polo's COGSA claim7 on the ground that Polo was not named in the bills of lading. The district court rejected Polo's argument that it was a third-party beneficiary to the bills of lading and granted summary judgment. In its motion for reconsideration Polo raised the alternative argument that the terms and conditions in the bills of lading contained numerous references to the owner of the goods as distinct from both shippers and consignees, and that owners of the shipped goods were a readily identifiable class of persons intended to be benefitted by the terms of the bills of lading. Tropical maintains that Polo waived this argument by failing to raise it earlier. Polo sufficiently raised the third-party beneficiary argument before the district court. Polo's reliance on the bills of lading's references to the term owner of the goods to sustain Polo's breach of contract claim 6 If Polo's argument, at its root, is merely that determination of a proper party in interest for a COGSA claim should not be limited to contract principles but should also make reference to tort claims, that argument is adequately addressed in this court's conclusion, infra, that the district court failed to consider fully Polo's ability to bring a COGSA claim as owner of the lost goods. 7 As noted earlier, the court treated Polo's contract claim as a COGSA claim. 5 is not a new argument, but part and parcel of its original argument that it was an intended third-party beneficiary to the bills of lading. The argument therefore is properly before us. Polo is not named in the bills of lading. Contracts bind only named parties unless both parties to the contract clearly express an intent to benefit a third party. See Blu-J, Inc. v. Kemper C.P.A. Group, 916 F.2d 637, 640 (11th Cir.1990). This rule of strict construction applies with equal force in contracts of carriage. See Hale Container Line, Inc. v. Houston Sea Packing Co., 137 F.3d 1455, 1465 (11th Cir.1998). The third party need not be mentioned by name as long as the contract refers to a well defined class of readily identifiable persons that it intends to benefit. Generali v. D'Amico, 766 F.2d 485, 490 (11th Cir.1985) (internal quotations omitted). Polo argues that the inclusion of the owner of the goods in the bills of lading evinces a clear intent to benefit that class of persons. The two bills of lading underlying this action list two different companies in the Dominican Republic as shipper/exporter, Drusco as both consignee and notifying party, and Tropical as carrier. The owner of the goods is not specified anywhere on the forms. The front of the forms, however, contains the following clause: In accepting this ocean bill of lading the shipper, consignee and owner of the goods agree to be bound by all of its stipulations, exceptions, and conditions, whether written, printed, or stamped on the front or back thereof, any local customs or privileges to the contrary notwithstanding.8 The back of the bills of lading uses the phrase shipper, consignee or owner of the goods repeatedly in defining the conditions of the contract of carriage. The final clause of the bills iterates that the Shippers, Consignees and Owners of the goods and the Holder of the Bill of Lading expressly agree to all its terms.9 Polo argues that these recurring references to the owner of the goods intend to benefit Polo. Our research found one case presenting strikingly similar facts, the reasoning of which we find persuasive. In All Pacific Trading, Inc. v. Vessel M/V HANJIN YOSU, 7 F.3d 1427 (9th Cir.1993), the court considered a consolidated action brought by nine owners of damaged goods and their insurers. Eight of the 8 Compl., Ex. A, in R., Tab 1. 9 Pl's Mot. for Recons., Ex. A, in R., Tab 41. 6 nine plaintiffs delivered their goods to different non-vessel-operating common carriers (NVOCCs) who issued bills of lading to the shippers and then delivered the goods to the carrier, who in turn executed separate bills of lading with the NVOCCs. See id. at 1429-30. The cargo owners were not named in the bills of lading with the carrier. See id. at 1430. The court rejected the carrier's argument that the plaintiff cargo owners lacked standing to sue because it found that the cargo owners were actual parties to the bills of lading under their definition of Merchant. See id. at 1431-32. As with the bills of lading before us, those bills of lading contained a clause obligating the owner of the goods to their terms. See id. at 1432. Polo's parallel contention is that well-established principles of maritime law grant an owner of lost or damaged cargo standing to sue for damages based on its proprietary interest in the goods, even if the owner is not explicitly named in the bill of lading.10 See, e.g., Schoenbaum, supra, § 8-10.11 Relying on the repeated references to the unnamed owner of goods in the bills of lading, Polo maintains that it is a proper party in interest to seek recovery from Tropical for the lost cargo.12 10 This argument was raised in Polo's response to Tropical's motion for partial summary judgment. See Pl.'s Resp. & Mem. of Law in Opp'n to Def.'s Mot. for Partial Summ. J. at 3, in R., Tab 29. 11 Tropical voices concern over the possibility of double recovery in the suits brought by Drusco and Polo. Polo acknowledges its obligation to Drusco, however, and any remaining apprehensions are matters for practical determination. Compagnie De Navigation Fraissinet & Cyprien Fabre, S.A. v. Mondial United Corp., 316 F.2d 163, 172 & n. 14 (5th Cir.1963). For example, on remand, Polo could agree to consolidate its claim with Drusco's or reduce its request for damages by the amount sought by Drusco in its complaint. The record demonstrates that Drusco and Polo are amenable to making such arrangements. See Pl.'s Reply to Def.'s Resp. to Pl.'s Mot. for Recons., Ex. A, in R. Tab 45 (letter from Drusco's counsel to Polo's counsel); Notice of Pendency of Other Actions and Mot. to Consolidate, in R., Tab 10 (filed by Polo). 12 Admiralty cases, like any other, must be brought by a real party in interest. See Fed.R.Civ.P. 17(a); Farbwerke Hoeschst A.G. v. M/V DON NICKY, 589 F.2d 795, 797 (5th Cir.1979) (The Federal Rules of Civil Procedure are fully applicable in admiralty cases.). Depending on the circumstances of the underlying transaction, a proper admiralty plaintiff might be the shipper or consignee named in the bill of lading, or the owner of the goods, with consideration given to which party had a proprietary or financial stake in the lost or damaged goods, and which party bore the risk of loss. For example, when a shipper sells goods to a buyer, determination of whether the seller or buyer is the real party in interest turns on whether title to the goods passed from the former to the latter at the point of shipment or of receipt of the goods. See Grant Gilmore & Charles L. Black, Jr., The Law of Admiralty § 3-6 at 100-08 (2d ed.1975). This case presents somewhat unusual circumstances in that the goods were being sent and received by the same party. 7 Under either theory of recovery, Tropical contends that summary judgment was appropriate because Polo never presented sufficient evidence of its ownership of the lost goods. The record generated by this case is regrettably sparse, but our review of its limited contents finds evidence of Polo's ownership of the goods sufficient to withstand summary judgment. Polo submitted an affidavit of Karen Jeannetti-Pascucci, Senior Director of Treasury and Risk Operations at Polo,13 which attested that POLO RALPH LAUREN owned 100% of the subject cargo, which consisted of 4,643 pairs of finished pants, at the time of the loss.14 Polo also presented deposition testimony of Daniel H. Moss, Executive Vice-President of Drusco, who stated that, The cargo was dropped overboard. It was Polo's fabric. I owe Polo for the fabric.15 Mr. Moss further testified that, under Drusco's contract with Polo, Polo ships me their fabric.... I cut it. I ship it to the Dominican Republic.... I buy what is known as trimmings or sundries and add that to it. I add the value of the labor to stitch it together. I ship it back.16 The bills of lading, with their numerous references to owner of the goods, were also before the district court. The bills of lading between Tropical and Drusco recurrently refers to the owner of the goods and specifically binds the owner of the goods to its terms and obligations, creating the possibility that Polo would have standing to sue as owner of the goods or as a third-party beneficiary to the bills of lading. Although this court does not express an opinion on whether Polo ultimately will be able to prove ownership of the lost trousers, there was sufficient evidence before the district court of Polo's ownership to render improvident its grant of summary judgment on Polo's COGSA claim. 13 Tropical questions the affidavit because Polo filed a correction after learning that the affidavit misstated that Polo had already paid Drusco for its services. This error, however, does not undermine the accuracy of the remainder of the affidavit. 14 Pl.'s Resp. & Mem. of Law in Opp'n Def's Motion for Partial Summ. J., Ex. 1 ¶ 2, in R., Tab 29. 15 Pl.'s Mot. for Partial Summ. J. as to Damages, Ex. 1 at 8, in R., Tab 36. 16 Id. at 8-9, in R., Tab 36. 8