Soomekh v United Parcel Serv., Inc.

[*1] Soomekh v United Parcel Serv., Inc. 2005 NY Slip Op 50405(U) Decided on March 29, 2005 District Court, Nassau County Fairgrieve, J. Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. This opinion is uncorrected and will not be published in the printed Official Reports.

Decided on March 29, 2005
District Court, Nassau County

Rabiolla Soomekh, Plaintiff(s),

against

United Parcel Service, Inc., Defendant(s).



SC646/04

Scott Fairgrieve, J.

ISSUES

Can plaintiff as consignee recover under the provisions of the Carmack Amendment to the Interstate Commerce Act?

Can the plaintiff recover the value of the gold plated silver coins under New York State common law principles from defendant? In the alternative, are plaintiff's claims precluded by the Carmack Amendment, and thus, barred by the Tariff Provisions?

NATURE OF CLAIM

Plaintiff has commenced this action to recover $3,276.99 which is the alleged value of gold plated silver coins shipped on March 19, 2004 from California to the plaintiff's home located in Great Neck, New York. The plaintiff (consignee) states the following as the basis of liability: "Mr. Manochewr Amidi sent me a box on 3-19-04 from California which there was [sic] gold plated silver coin which I never received. I contacted U.P.S. few time and I never got a right answer why I never received the package."

In support of its motion for summary judgment, defendant has submitted the affidavit of Artie [*2]Steigert who is the Security Manager for the Long Island District New York facility of UPS. UPS is a common carrier which entered into an agreement with "The Box Store" on March 9, 2004, to ship a package from California to Great Neck. The Box Store is an authorized shipping outfit where "customers can tender packages for transportation through UPS or other carriers." In this case the package was shipped via UPS. Mr. Steigert claims in the affidavit that UPS "did not know what was in the package when Mr. Amidi shipped it." UPS contends that its records demonstrate that the package was left at plaintiff's door located at 4 Radcliff Drive, Great Neck, New York. This type of delivery is referred to as a "driver release" which is "appropriate pursuant to the terms of the UPS Tariff."

Defendant contends that it cannot be held liable for the allegedly lost package because: (1) package was shipped through an Authorized Shipping Outlet and so UPS has no direct relationship with plaintiff, and (2) coins, such as the Iranian gold-plated silver coins shipped herein, are considered "articles of unusual value" which may not be shipped via UPS pursuant to the terms of the UPS Tariff.

UPS submits the Tariff which governs this transaction entitled "General Tariff Containing the Classifications, Rules, and Practices for the Transportation of Property," effective July 14, 2003. Tariff item 1090 is cited as barring a direct action by plaintiff:

AUTHORIZED SHIPPING OUTLETS UPS Authorized Shipping Outlets or Commercial Counters (collectively referred to within this Item as "ASOs") are independently owned and operated businesses and are not agents of UPS. UPS assumes no liability other than to the ASO, as the shipper of the package, for lost, damaged, or delayed packages sent via the ASO. Any such liability to the ASO is subject to the limitations set forth in the applicable UPS Tariff or Service Guide. All inquiries regarding packages shipped via ASOs must be directed to the ASO. UPS will deal solely with the ASO in all matters concerning packages shipped via an ASO, including but not limited to: tracking/tracing requests; claims and guarantees; C.O.D. preparation and remittance; return of undeliverable packages and letters; proper packaging and labeling; and billing. Even if UPS responds directly to ASO customers regarding tracking requests, UPS will not be liable to those who shipped packages via the ASO. The ASO agrees not to ship any articles that UPS does not accept for transportation. ASOs shall indemnify and hold harmless UPS in any action against UPS arising from the loss, damage, or delay of a package shipped via the ASO.

Tariff item 460 is cited as barring any claim for the 40 silver gold plated coins because these items are articles of unusual value; this provision states:

[*3]

DEFINITION OF ARTICLES OF UNUSUAL VALUE,

WHICH ARE NOT ACCEPTED BY UPS FOR TRANSPORTATION Shippers are prohibited from shipping articles of unusual value via UPS. Articles of unusual value shall be deemed to include, but are not limited to:(1)Coins (except pennies and nickels, and except proof and mint sets of United States coins tendered by United States mints of a face value not to exceed $2.41), currency, postage stamps, negotiable instruments (except checks), money orders, unset precious stones, and industrial diamonds.(2)Any article which contains more than fifty percent by weight of gold, silver, or platinum or any combination thereof in raw form, bullion, balls, bars, grains, strip, sheet, wire, chain, ingots and the scrap of these metals.(3)Any package having a value of more than $50,000.UPS will not be liable for any loss of, or damage to, articles of unusual value.

Plaintiff opposes the defendant's motion for summary judgment based upon the following set of facts asserted in the affidavit in opposition dated December 14, 2004: 1.In answer to your command for sending valuable coins, the material that was sent wasn't Trading Coins. There [sic] were Memorial Coins that exchanges only between Persian community because it has the picture of King of Iran.2.On your statement you said UPS doesn't allow shipping articles of unusual value. But when the sender was sending the material the clerk at your office examined the material and never denied sending it or letter the sender know [sic] he's prohibited of sending it and insured it for the amount of $3000.3.You said ASO' has no relation with UPS, but we have a record from UPS which I provide you with the copy of it and the copy of their business card. I have a shipping track No.1Z51XW20344361624 which belongs to UPS authority.

DECISION

This Court holds that the Carmack Amendment governs the liabilities of the parties to this dispute and bars all state claims. Judge Holwell explains in Travelers Indemnity Company of Illinois v. Schneider Specialized Carriers, Inc., N.Y.L.J. 2/22/05, p. 23, col. 1 (S.D. NY, 2005), that the [*4]purpose of the Carmack Amendment is to provide a uniform system to adjudicate all claims involving shipping of goods in interstate commerce and preempts all state claims: The Carmack Amendment, enacted in 1906, "governs the liability of common carriers for loss or damage to goods shipped or transported in interstate commerce." Calka v. North American Van Lines, Inc., No. 00 Civ. 2733 (AGS), 2001 WL 434871, at *2 (S.D.NY Apr. 27, 2001) (internal citations and quotations omitted). Specifically, the Carmack Amendment "subjects a motor carrier transporting cargo in interstate commerce to absolute liability for loss to the cargo unless the carrier limits its liability by meeting certain requirements." Wayne v. DHL Worldwide Express, 294 F.3d 1179, 1185 (9th Cir. 2002) (citing 49 U.S.C. §14706(c)(1)(a)). The purpose of the Carmack Amendment is to "provide interstate carriers with reasonable certainty and uniformity in assessing their risks and predicting their potential liability." Project Hope v. M/V IBN SINA, 250 F.3d 67, 73 n.6 (2d Cir. 2001) (citing Morris v. Covan World Wide Moving, Inc., 144 F.3d 377, 381 (5th Cir. 1998). As such, the Carmack Amendment establishes a "single uniform regime for recovery by shippers directly from [the] interstate common carrier in whose care their [items] are damaged . . . and by pre-empt[ing] [the] shipper's state and common law claims against a carrier for loss or damage to goods during shipping." Id. (internal citations and quotations omitted).It is thus well settled that Congress clearly intended the Carmack Amendment to preempt all state law claims against interstate carriers for loss or damage to goods during shipping. See Adamd Express Co. v.Croninger, 226 U.S. 491, 505-07 (1913) ("Almost every detail of the subject is covered so completely that there can be no rational doubt that Congress intended to take possession of the subject, and supersede all state regulation with reference to it."); Hoskins v. Bekins Van Lines, 343 F.3d 769, 778 (5th Cir. 2003) ("Congress intended for the Carmack Amendment to provide the exclusive cause of action for loss or damages to goods arising from the interstate transportation of those goods by a common carrier."); Sorrentino v. Allied Van Lines, Inc., No. 01 Civ. 1449 (AHN), 2002 WL 32107610, at *2 (D. Conn. March 22, 2002); Orlick v. J.D. Carton & Son, Inc., 144 F. Supp. 2d 337, 345 (D.N.J. 2001). Based on this interpretation, several courts have construed the Carmack Amendment to preempt completely state law causes of action. Hoskins, 343 F.3d at 778 (applying "complete preemption doctrine" and concluding that Carmack Amendment preempted claims of negligence, breach of contract and Texas Deceptive Trade Practices Act); Smith v. United Parcel Service, 296 F.3d 1244, 1246 (11th Cir. 2002) (claims of fraud, negligence, wantonness or outrage preempted by Carmack Amendment); Ash v. Artpack Int'l Inc., No. 96 Civ. 8440 (MBM), 1998 WL 132932, at *4 (S.D.NY March 23, 1998) ("The Carmack Amendment is an example of a statute that completely preempts the field it occupies.").

The Court rejects defendant's argument that the plaintiff as consignee is estopped from [*5]bringing this action under the Carmack Amendment. A consignee is permitted to bring an action against UPS under the Carmack Amendment and is bound by the terms of the Carmack Amendment; see Travelers Indemnity, supra, holding that: Travelers Indemnity contends that as subrogee to Quality Carton, the consignee, it is not bound by the Carmack Amendment. According to Travelers Indemnity, the Carmack Amendment only applies to shippers. (Rodgers Decl. ¶10). Under the Carmack Amendment, a carrier must issue a bill of lading for property it receives for transportation. 49 U.S.C. § 14706(a)(1). The bill of lading subjects the carrier to liability to "the person bound by the bill of lading" for any losses arising out of the shipment of the goods. Id.; Calka, 2001 WL 434871, at *2. Indeed, the Supreme Court has specifically stated that "[b]y virtue of the Carmack Amendment, 34 Stat. 584, amended, 38 Stat. 1196, 49 U.S.C.A.s 20(11), [a] bill of lading determines the rights of consignee." Mexican Light & Power Co., Ltd. v. Texas Mexican Railway Co., 331 U.S. 731, 733 (1947); Air Products and Chemicals, Inc. v. Illinois Central Gulf R. Co., 721 F.2d 483, 486-87 (5th Cir. 1983) (purpose of the Carmack Amendment was to "provide a uniform rule that the carrier issuing the bill of lading would be responsible to the consignee for all loss, damage, or delay arising out of the contract to transport the goods so shipped." (emphasis added); S&H Hardware & Supply Co. v. Yellow Transp. Inc., No. 02 Civ. 9055, 2004 WL 1551730, at *3 n.6 (E.D. Pa. July 8, 2004) (remarking that a consignee has "standing to bring an action under the Carmack Amendment to recover the value of goods lost"). Accordingly, the Court concludes that Quality Carton, as consignee, and Travelers Indemnity, as subrogee to Quality Carton, are bound by the Carmack Amendment.

See also S&H Hardware & Supply Co. v. Yellow Transportation, Inc., 2004 WL 1551730 (E.D. Pa., 2004) holding that a consignee may maintain action under the Carmack Amendment.

This Court further holds that plaintiff cannot recover the value of the gold plated silver coins because UPS Tariff Section 460 specifically excludes coins from being shipped, and said coins constitute "articles of unusual value." The Tariff specifically states that UPS is not liable for loss of articles of unusual value. Thus, plaintiff is precluded from recovering the loss of the coins shipped.

This ruling is consistent with other cases. In Commodities Recovery Corp. v. Emery Worldwide, 765 F. Supp. 210 (D.C. N.J. 1991), the Court dismissed plaintiff's action to recover the loss of a package valued at $42,000. which contained currency.

Recently, Judge Spatt, in Materazzi v. Atlas Van Lines, Inc., 180 F. Supp. 408 (E.D. NY, 2001), held that a defendant moving company was not liable pursuant to state or federal law remedies, because the Carmack Amendment preempts same. The Court dismissed the plaintiff's claims for damages to her belongings during transport. [*6]

Thus, based upon the foregoing, plaintiff's state law claims are preempted by the Carmack Amendment and plaintiff cannot recover the value of the coins based upon the restrictions of the Tariff applicable herein.

CONCLUSION

Plaintiff's action is dismissed with prejudice. Plaintiff's claims are preempted by the Carmack Amendment. There cannot be any recovery because the coins are articles of unusual value specifically excluded under Item 460 of the Tariff.

So Ordered:

DISTRICT COURT JUDGE

Dated: March 29, 2005