Opinion ID: 576645
Heading Depth: 2
Heading Rank: 2

Heading: Construction of the Contract: Industry Custom and Course of Dealing

Text: 34 Our inquiry, however, does not end there. Instead, we must evaluate Global's underlying premise that the overarching Bill of Lading in this case was actually a contract for both sea transport across the Pacific Ocean and crossland transport across the United States, instead of a contract for sea transport alone. 35 Given the contract's ambiguity, we must focus our inquiry on the course of dealing between Berkshire and ASTI, and the custom of shippers transporting goods from Taiwan. See Spartus Corp. v. S/S Yafo, 590 F.2d 1310, 1313-14 (5th Cir.1979). This approach is consistent with the longstanding judicial practice of interpreting the route of sailing, in the absence of a specified route, to be the normal sailing route as defined by trade practice and custom. See Hostetter v. Park, 137 U.S. 30, 38, 11 S.Ct. 1, 3, 34 L.Ed. 568 (1890). 36 Global contends that the district court has already inquired into the customary practice of trade between Berkshire, Jiung Chia, and ASTI and found, based upon that practice, that the contract called for both land and sea transport. Relying on the testimony of Berkshire's employee, Mindy Bellow, Global argues that most of the shipments that Berkshire received from Taiwan came by ship to Los Angeles and then by train from Los Angeles to New York. Therefore, defendants argue that the customary practice would have suggested to Berkshire that, regardless of the ambiguous language of the Bill of Lading, the goods would be transported by rail from Los Angeles to New York. 37 However, the evidence considered by the district court was insufficient to establish that combined land and sea transport was part of either the course of dealing between Berkshire and ASTI or consistent with industry custom. While Bellow's testimony demonstrates that goods shipped from Taiwan to Berkshire are frequently transported by both sea and land, her testimony fails to shed light on the specific course of dealing between Berkshire and the other parties involved in this suit. A more searching factfinding may reveal that Berkshire usually engaged freight forwarders in Taiwan who shipped goods to Los Angeles and then sent them by rail to New York, but that Berkshire's relationship with or expectation of ASTI was different. There are simply no facts on record that illuminate either the past course of dealing between the parties in this case or the expectations that the parties reasonably entertained as a result of the bargaining conducted here. 38 Nor does Bellow's testimony shed light on the usual trade practice and custom involved in shipping goods, particularly umbrellas and similar items, from Taiwan to New York. Again, while Berkshire might have received goods by rail from Los Angeles after shipment there, Berkshire may also have been aware that this practice deviated from the norm in shipping goods from Taiwan to New York. Such shipments might customarily follow an entirely maritime route. Nothing in the record before us demonstrates the contrary. Before the district court declines to exercise admiralty jurisdiction over this case, it must first determine that Berkshire did not have a reasonable belief, based on its prior dealings with the defendants in this case or on usual trade practice and custom, that the goods would travel entirely by sea to New York. 39 Further factfinding on all these matters will allow the district court to determine whether land transport of the goods was actually what was contemplated by the parties in the Bill. 40