Mediterranean Shipping Company (USA) Inc. v. Cargo Agents, Inc., No. 1:2010cv05070 - Document 21 (S.D.N.Y. 2011)

Court Description: MEMORANDUM OPINION AND ORDER re: #101146 11 FIRST MOTION for Summary Judgment Notice of Motion filed by Mediterranean Shipping Company (USA) Inc.: Plaintiff's Motion for Summary Judgment is granted. The Clerk shall enter judgment agains t Defendant for demurrage damages in the amount of $30,191, plus interest, calculated at the average short term T-bill rate for the period between May 6, 2010, and December 15, 2011. (Signed by Magistrate Judge Theodore H. Katz on 12/15/2011) (ab) Modified on 12/16/2011 (jab).

Download PDF

~================11, UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK --x MEDITERRANEAN SHIPPING CO. (USA), Plaintiff, 10 Civ. 5070 (THK) against MEMORANDUM OPINION AND ORDER CARGO AGENTS, INC., Defendant. ------ -------- ------- -----x THEODORE H. KATZ, United States Magistrate Judge. Plaintiff Mediterranean Shipping Co. ("Mediterranean ll ) (USA) brought this admiralty action against Defendant Cargo Agents, Inc. ("Cargo Agentsll) to recover demurrage. Plaintiff now moves for summary judgment pursuant to Federal Rule of Civil Procedure 56. 1 For the reasons set forth in this decision, the motion is granted. BACKGROUND Plaintiff Mediterranean is a New York corporation and common carrier, which acts as the agent of Mediterranean Shipping Company S.A., a Swiss entity. corporation. (Complaint ~ 3.) Cargo Agents is a New York Mediterranean's primary business is the shipping of large containers by sea to ports across the world. "an ocean transport intermediary" based in Cargo Agents is New York. The parties consented to proceed before this Court for all purposes, pursuant to 28 U.S.C. 636(c). Federal jurisdiction is found in admiralty, under 28 U.S.C. 1333. I Affidavit of Hatt Af f. ") ~ 8.) Brown, filed on October 31, 2011 ("Hattie Brown The dispute between Mediterranean and Cargo Agents is about a shipping container sent from Cherry Hill, Massachusetts, bound for Vitoria, delivered a Brazil. forty- foot It is uncontested that Cargo Agents shipping container, contained personal items and household goods, Mediterranean, Massachusetts. which they stated to be delivered to Mediterranean transported this container over land to New York, where it was loaded onto a ship. It arrived in Vitoria, Brazil, in March 2009, and Mediterranean notified Cargo Agents that the container had reached s intended port. No one ever came to claim the contents of the container. Soon thereafter, Mediterranean sent notice to Cargo Agents that Cargo Agents had exceeded their "free-time," and would be liable for demurrage and other charges. 2 the cargo arrived in Vitoria, In May 2010, more than a year after the Brazilian government allowed 2 Typically, a shipper is entitled to a certain number of days, known in the industry as "free-time," to use a shipping container. Once the shipper has exceeded this allotment, it may owe a contractual fee to the shipping company, called "demurrage." (Declaration of Jorge Boose, dated October 7, 2011 ("Jorge Boose Decl.") ~ 6); see, e.g., Evergreen Marine Corp. v. Welgrow Int'l Inc., 954 F. Supp. 101, 102 (S.D.N.Y. 1997) ("Detention charges (or 'demurrage') are charges for delays in returning cargo containers to the carrier within a specified time after the goods are tendered to the consignee designated to rece the shipped goods in another port.") . 2 --------------"'I',""', ¢ ¢ ¢ ¢ ¢ ¢ ¢ ¢ ¢ ¢ ¢ ¢ ¢ ¢ ¢ ¢ ¢ ¢ ¢ ¢ ¢ ¢ ¢ ¢ ¢ ¢___ "i:Of Mediterranean to remove the cargo and take its shipping container back. Mediterranean brought this suit, claiming it was entitled to damages of $31,294.58, plus interest, as well as attorney's fees and costs. 3 allegations defenses, Plaintiff, Cargo Agents's Answer denied virtually all of the in the Complaint, and asserted including the absence of damages, the culpability of eight affirmative the culpability of "other third parties," and that Defendant was acting as an agent for a disclosed principal. Def.'s Ans. at 1-2.) After the conclusion of pretrial discovery, Mediterranean filed the instant motion. DISCUSSION I. The Summary Judgment Standard A. Federal Rule 56 under Rule 56(c) of the Federal Rules of Civil Procedure, a motion for summary judgment should be granted "if the pleadings, the discovery and disclosure materials on file, and any affidavits show that there is no genuine issue as to any material fact and that the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(c) (2); see also Celotex Corp. v. Catrett, 477 U.S. 317, 322-23, 106 S. Ct. 2548, 2552-53 (1986) i Shannon v. N.Y. City 3 Plaintiff has asserted different amounts of damages at different points in the litigation. The figure here is from Jorge Boose's Declaration in Support of the Motion for Summary Judgment. (See Jorge Boose Decl. ~ 17.) 3 Transit Auth., 332 F.3d 95, 98 (2d Cir. 2003). The burden of demonstrating the absence of any genuine dispute as to material facts rests upon the party seeking summary judgment. v. S. H. Kress & Co., 398 U.S. 144, 157, Columbia Univ., 224 90 S. Ct. F.3d 33, 1598, 41 1608 (1970) i Weinstock v. (2d Cir. 2000). Once a properly supported motion for summary judgment has been submitted, the burden shifts to the non-moving party to make a sufficient showing to establish the essent elements of the claims on which it bears the burden of proof at trial. See Hayut v. State Univ. of N.Y., 352 F.3d 733, 743 (2d Cir. 2003) ~~~~~~~~~~~~, i 326 F.3d 330, 337 (2d Cir. 2003) (citing Celotex, 477 U.S. at 323, 106 S. Ct. at 2553). In assessing the record genuine issue to be tried as required factual to resolve inferences 255, ambiguit I 2505, and there is a fact, courts are all permissible draw the party against 2513 F.3d 137, 144 (2d Cir. 2006). (1986) whom summary i McClellan v. Smith, 439 However, in opposing a motion for the non-moving party must put forth "specific facts showing there is a genuine issue 56 (e) (2) . whether Anderson v. Liberty Lobby, Inc., 477 U.S. 106 S. Ct. summary judgment, determine to any material in favor of judgment is sought. 242, to trial." Fed. R. Civ. P. A summary judgment opponent "must do more than simply show that there is some metaphysical doubt as to the material 4 ............................................ --------------------~i~:~, _~ facts. Matsushita Elec. Indus. Co., Ltd. V. Zenith Radio Corp., II 475 U.S. 574, 586, 106 S. Ct. 1348, 1356 (1989). party may not rely on its pleadings, The non-moving mere al ions, simple denials, conclusory statements, or conjecture to create a genuine issue for trial. 2514; See Anderson, 477 U.S. at 256-57, 106 S. Ct. at Guilbert v. Jeffreys v. Gardner, 480 F. City of New York, 3d 140, 145 426 F.3d 549, (2d 554 r. 2007) ; (2d Cir. 2005) (non-moving party "must offer some hard evidence showing that its version of the events is not whol fanciful") . At the summary judgment stage, "it is undoubtedly the duty of district courts not to weigh the credibility of the parties." Jeffreys! {noting 426 F. 3d at that 554; accord McClellan, " [c]redibility assessments, 439 F. 3d at choices 144 between conflicting versions of the events, and the weighing of evidence are matters for the jury not for the court on a motion for summary judgment"} . B. Local Rule 56.1 Under the Southern District of New York's Local Civil Rule 56.1, a party moving for summary judgment must submit a "separate! short and concise statement, in numbered paragraphs, of the material facts as to which the moving party contends there is no issue to be tried. District of New York 56.1(a) II Local Civil Rule of the Southern ("Local Rule 56.1"). 5 ., Significantly, "[e]ach numbered paragraph in the statement of material facts set forth in the statement will be deemed to be admitted for purposes of the motion unless the nonmoving party specifically controverts each item by a correspondingly numbered paragraph in the statement II Local Rule 56.1 Both parties I (c) . statements must be "followed by citation to evidence which would be admissible" under Federal Rule of Civil Procedure 56 (e) . Local Rule 56.1(d). Defendant Cargo Agent has failed to comply with Local Rule 56.1, because it did not submit a numbered statement corresponding to Plaintiff s statement I of uncontested facts. party's failure to adhere to Local Rule 56.1(b) A non-moving can prove fatal because "[it] permits the court to conclude that the facts asserted in the statement are uncontested and admissible. case l In the typical failure to respond results in a grant of summary judgment once the court assures itself that Rule 56's other requirements have been met. II T.Y. v. New York City Dep/t of Educ., 584 F.3d 4121 418 (2d Cir. 2009) (internal citations omitted) i see Gadsden v. Jones Lang LaSalle (S.D.N.Y. 2002) Americas, Inc., 210 F. Supp. 2d 430, 438 (collecting cases) ("[c]ourts in this circuit have not hesitated to deem admitted the facts in a movant's Local Rule 56.1 Statement that have not been controverted by a Local Rule 56.1 statement from the non-moving party. II) 6 i D'Angelo, 224 F.3d 137, 138 (2d Cir. 2000) "appropriate" in light of non-moving party's (summary judgment lure to comply with Local Rule 56.1(b)) Nevertheless, seeking summary Local Rule judgment of 56.1 the "does not absolve the party burden of entitled to judgment as a matter of law, showing that it is and a Local Rule 56.1 statement is not itself a vehicle for making factual assertions that are otherwise unsupported by the Rockefeller & Co./ Inc., 258 F.3d 62, 74 record." Holtz v. (2d Cir. 2001); see also Giannullo v. City of New York, 322 F.3d 139, 140 (2d . 2003). III. Uncontested Facts 4 Based on the submissions of the parties, the Court finds that following facts, which are relevant to all of claims, are not subject to any serious disagreement. iff's There is no question that the shipping container was delivered to Mediterranean by Cargo Agents, in Massachusetts, in February 2009. Boose Decl., Ex. B.) That container was brought to the Port Jorge New York, where it was loaded onto the m/v MSC Tanzania, which arrived in Vitoria, Brazil in March, 2009. The container was unloaded to Many of these facts are drawn from Plaintiff's Local Rule 56.1 Statement, because Defendant has not disputed these facts with any reference to admissible evidence. See Giannullo, 322 F.3d at 140; Orient Overseas Container Line Ltd. v. Crystal Cove Seafood Corp., No. 10 Civ. 3166 (PGG) , 2011 WL 4444527 at *1 n.l (S.D.N.Y. sept. 26, 2011). 4 7 the marine terminal in Mediterranean sent notice ~ Decl. 16.) toria on Once the free-t the and it the container, terminal until May 5, 2010. 2009,5 and Jorge Boose period of seven days had expired, (Id.) of 20, to the Consignee. 6 notice was sent to Cargo Agents. contents March Whi No one arrived to pick up remained the marine the container was on the Vitoria docks, Mediterranean attempted to contact Cargo Agents repeatedly. (Id., Ex. C.) On May 5, 2010, Mediterranean was granted permission by the Brazilian Customs Authority to unpack and dispose of the contents of the container, and to It is uncontested that its container. Mediterranean and Cargo Agents contracted to send the shipping container to Brazil, and that Cargo Agents was the shipper listed on the has further furnished a copy of that 11 of Lading. Mediterranean 11 of Lading, as well as a 5 One of the exhibits filed with the Court suggests that the container was discharged from the Tanzania on March 2, 2009, (See Jorge Boose Decl., Ex. C), while the Complaint ~ 11, the Rule 56.1 Statement ~ 9, and the Memorandum of Law in Support of Summary Judgment, at 7, all state that was discharged on March 20, 2009. The disparity in dates in Plaintiff's filings do not affect the issue liability, but do fect the measure of damages. The Court assumes that there was an error in the exhibit, and that the container was discharged on March 20, 2009. The Consignee is the client whom Cargo Agents was acting on behalf of to ship the container. In this case, the Consignee was also the "Notify." ( Jorge Boose Decl. ~ 16.) She is 1 ted on the Bill of Lading as "Alexandra Hernandez." (Id., Ex. 6 C. ) 8 copy of a communication between the part s confirming that Mediterranean sent Cargo Agents a copy of the Bill of Lading. The Bill \\ includ [ing] Lading provides a the freight and 1 definition of charges, costs "freight" and as expenses whatsoever payable to the Carrier in accordance with the applicable Tariff and this Bill of Lading, demurrage." 1) (Jorge (emphasis added). Boose including storage, per diem and Decl., Ex. A, 11 of Lading ~ The Bill of Lading also provides that the "merchant," in this case, Cargo Agents, was required to pay the full amount of freight under the contract. (Id. ~~ 2, 16.) The contract makes it clear that Cargo Agents was responsible for retrieving the container once it had been port. livered to the The contract states that: "[t]he Carrier allows a period of free time the use the containers and other equipment in accordance with the Tariff and as advised by the local [Mediterranean] agent at the Ports of Loading and Discharge. Free time commences from day the Container and other equipment collected by the Merchant or is discharged from the Vessel or is delivered to the Place of Delivery as the case may be. The Merchant is required and has the responsibility to return to a place nominated by the carrier the Container and other equipment before or at the end of the time allowed at the Port of scharge or the Place of Delivery. Demurrage, per diem and detention charges will be levied and payable by the Merchant thereafter in accordance with the Tariff." (Id . ~ 14. 8 . ) It further states that: "[t]he Merchant shall take delivery of the goods within the time provided for in the Carrier's 9 applicable ff or as otherwise agreed." ~ (Id. 20.2.) Mediterranean has provided the Court with a schedule of demurrage s for Vitoria, Brazil, that is part of the tariff mandated by the Federal Maritime Commission. free time, Bill of and then lists its rate schedule for demurrage. Lading explicitly lable on request, tariff. The tariff includes seven days of (Id. ~ incorporates the tariff, The makes and deems the shipper to be aware of 3.) III. Plaintiff's Claim For Demurrage There is no material issue of fact with regard to Plaintiff's claim for demurrage. There was a contract between the parties, which consisted of the Bill of Lading and the tariff which was expressly incorporated into the contract. Co. v. Elmore & Stahl, 377 U.S. 134, See Missouri Pac. R.R. 144, 84 S.Ct. 1142, 1148(1964) ("[t]he shipping contract consists of the bill of lading and the applicable tariffs lawfully published and fi from which there may be no departure. 1/) (internal citations omitted) ( (Douglas, J., dissenting); accord Orient Overseas Container Line at *5. "Where the language of a contract is clear, summary judgment is appropriate, and the fact that one party may have a different interpretation of the language does not make it any less plain." Harris Trust and Sav. Bank v. John Hancock Mut. Life Ins. Co., 970 F.2d 1138, 1147 (2d 1992) . 10 Here, the contract is clear and unambiguous. Section 2 states that Cargo Agents (designated as "the Merchant") "warrants that. [it] is owner of the goods or [agrees to the contract] with the authority of the owner." (Bill of Lading ~ 2.) Section 3 states that the tariff is incorporated into the contract, and specifically directs the shipper to possible ~ charges, including demurrage. 3.) Section 20 states that the merchant is responsible for ensuring the delivery of the goods. ~ 20.) Demurrage is a standard fee associated with shipping through common carriers; so much so that courts have found it to be an implied maritime term in contracts. See, e.g. Safmarine v. Columbia Container Lines (USA), Inc., No. 10 Civ. 1825(KAM), 2010 WL 7134001 at *3 (E.D.N.Y. 2010) (collecting cases). The term was explicitly used in the Bill of Lading, and the tariff including the schedule of fees was easily accessible to Defendant. Contrary to Defendant's characterization of Plaintiff's cause of action as an "attempt[] to create a windfall profit by relying on the fine print of its Bill of Lading is simply asking for "(Hattie Brown Aff. ~ 7), Plaintiff they are entitled to under long standing industry practice and the terms of its agreement with Defendant. And Defendant was not an unsophisticated party: Cargo Agents is an Ocean Transportation Intermediary (Id. ~ 8), an indus position well-enough defined to have its own section in the United States 11 Code. See 46 U.S.C. 40901. § Defendant raises several purported disputes as to facts or its defenses. None of these s preclude summary judgment. a material dispute that can First, Defendant claims that the Court must determine why it took over one year for the container to be returned. dispute. Agents, (Def.' s Mem. at 2.) But this is immaterial to the The terms of the Bill of Lading make it clear that Cargo not Mediterranean, returning the container. was responsible (Jorge Boose Decl. for I unpacking and Ex. A , 14.8); see also Pennsylvania R. Co. v. Moore-McCormack Lines, Inc., 370 F.2d 430, 431-32 where (2d Cir. defendant stevedores' was 1966) (upholding an award of demurrage even prevented from retrieving Mediterranean strike) . has its cargo by a further provided uncontroverted evidence that it made several attempts to contact Cargo Agents. , Ex. C). Defendant's vague insinuations that Mediterranean may have acted in bad th to maximize demurrage costs is no more than conjecture, and conjecture does not create a dispute about a material ====~, issue of See Matsushita Elec. 475 U.S. at 586, 106 S.Ct. at 1356. Defendant also claims that a trial is necessary to determine whether or not Plaintiff received money cargo. But Defendant had an opportunity the liquidation of the to conduct pretrial discovery and has not prof erred any competent evidence indicating 12 that Plaintiff received value for the liquidation of the cargo. Even were a more intens would not preclude -finding process necessary, granting R. Civ. Mediterranean liability. See Fed. P. necessary. The cargo was listed as summary judgment 56(g). And fact-finding ~household this on not goods and personal effects,U and can be presumed to have little resale value. Schwab v. Reilly, 130 U.S. S.Ct. 2652, 2675 n.11 (2010) (discussing the household goods exemption in the context of bankruptcy proceedings) . Accordingly, the Court finds that Plaintiff Mediterranean is entitled to summary judgment against Defendant Cargo Agents on its ent lement to demurrage. IV. Damages A. Demurrage Plaintiff asks for an award of damages of $31,344.58, Boose Decl. ~ (Jorge 17), which its claims as the amount owed in demurrage fees and other costs associated with retrieving the container. 7 This figure is based on the tariff rate. Defendant argues that Plaintiff's theory of damages is flawed. The Rule 56.1 Statement states that the total fees are $31,294.58 (Rule 56.1 Statement' 12), and the Complaint lists a different f The Declaration is the only submission that includes an accounting, and the Court has therefore relied primarily upon it. 7 13 (Hattie Brown Aff.~~ 5-6.) demonstrate any actual Defendant claims that Plaintiff cannot loss shipping container, and that, entitled to damages. Demurrage is (Id. an ~ due to the therefore, unavailability of the Plaintiff should not be 7.) accepted form of liquidated damages in shipping, see Ocean Transp. Line v. AM. Philippine Fiber Ind., 743 F.2d 85, 90 (2d Cir. 1984) ; see also Toyomenka Pacific Petroleum, Inc. v. Hess (S.D.N.Y. Oil Virgin 1991) ("Demurrage Islands Corp., has sometimes stipulated damages for detention." and in any event, 771 F. Supp. 69 described been 63, as (internal citations omitted), Plaintiff is not allowed to deviate from its published tariff. See 46 U.S.C. show actual that loss, inquiry § 1S 41104. While Plaintiff must not used as the measure of damages where the contract provides for a reasonable demurrage fee. See Marin Tug & Barge, App'x 757, 759 (9th Inc. v. Westport Petroleum, Cir. 2001) ("[T]he mere Inc., 1 Fed. stipulation of a liquidated sum for demurrage [does not] obviat[e] the need to show actual damages. At the same time, actual damages does not vitiate the the requirement of proving [stipulated] demurrage rate unless such a rate is so excessive that it constitutes a penalty.") (alterations citations omitted). in This original) (internal quotations and rule has been established since the earliest days of federal admiralty jurisprudence. 14 See, e.g. The ::..::&::.===, 22 U.S. 362, 378 (1824) ("In truth, demurrage is merely an lowance or compensation for the delay or detention a vessel. It is often a matter of contract, but not necessarily so."). In other words, once a plaintiff has demonstrated that there has been loss, loss that is, the loss of the use of a container, the amount of measured by the demurrage rate. The Court, therefore, awards Plaintiff damages for demurrage in the amount of $30,191. This figure was reached based on the The tariff provides for 7 days of applicable tariff. which ran from March 20, 2009 until March 26, 2009. 8 days, from March 27, 2009 until was $49.00 per day, -time, For the next 1 4, 2009, the demurrage rate For the remaining 387 or $392.00 in total. days, the demurrage rate was $77.00 per day, or $29,799 in total. The final figure for demurrage is therefore $30,191. Plaintiff has also asked for a variety of administrative costs and charges. Jorge Boose Decl. ~ 17.) While these requests are relatively modest, the Court either cannot find these charges listed on the Bill of Lading, or the amounts for the charges do not correspond to the fees listed on the 11. For example, Mediterranean asks for a "Terminal Handling Charge" of $211.56, but that is listed on the Bill of Lading as a $300.00 fee. fees, such as the "Bill of Lading Fee," The other the "MSC Administrative Fee," and the "ISPS Charge," do not correspond to any charges on 15 the Bill of Lading that Mediterranean produced to the Court, and no other proof of these charges has been submitted. Therefore, the Court cannot find sufficient proof of these fees, and declines to award them. B. Interest Plaintiff also asks for an award of interest on its damages. "Although it is an abuse of discretion to deny prejudgment interest in admiralty cases except under extraordinary circumstances, dis the t court has broader discretion to determine when interest commences and what rate of interest to apply." Independent Bulk Transport, Inc. v. Vessel Morania Abaco, 676 F.2d 23, 25 (2d Cir. 1982) (internal citation omitted). to be solely compensatory. In admiralty, interest is meant See New York Marine & Gen. Ins. Co. v. Tradeline (L.L.C.), 266 F.3d 112, 131 (2d Cir. 2001) ~~~-===~~~~===, 160 F.2d 502, 506. i O'Brien Bros. (2d Cir. 1947). Since interest is meant to be compensatory, and Mediterranean will be compensated through demurrage for the lost use of its shipping container during the time when the container was detained, the Court concludes that interest should commence on May 6, 2010, the day when Mediterranean disposed of the cargo and recovered its container, and run until the entry of judgment. will be based on The interest rate average 4-Week Treasury Bill rate for that time period. 266 F.3d at 131("Interest is 16 , ; intended to make the injured party whole be measured by interest on obligations. ") (internal quotat Dessert Service, Inc. v. . . and generally should short term, risk-free marks and citations omitted); M/V MSC Jamie/Rafaela, 219 F. 504, 509 (S.D.N.Y. 2002) (" [t]he T-bill rate more c Supp. 2d ly parallels the income the damages would have earned in a short-term, risk-free investment. ") (citing Transatlantic Marine Claims Agency Inc. v. M/V "OCCL INSPIRATION", 137 F.3d 94, 104 (2d Cir. 1998)). C. Attorneys' Fees and Costs Plaintiff also requests attorneys' fees and costs related to pursuing this claim. The contract between the parties includes a provision for the award of attorneys' fees, Ex. A to ~ 14.7), and there is no question that parties are entitled seek fees and costs under such Reliance Standard Life Ins. Co., 57 (See Jorge Boose Decl., (2010). Nevertheless, a provision. U.S. it is a See -, 130 S.Ct. 2149,2156 I-established rule in this Circuit "that absent unusual circumstances attorneys are required to submit contemporaneous ~~~~-=~~==-===~===, records with the fee applications." 626 F.3d 130, 133 (2d Cir. 2010) (citing New York State Ass'n for Retarded Children v. Carey, Inc., 711 F.2d 1136 (2d Cir. 1983)) Supp. 2d 347, 356 i see also Tucker v. City of New York, 704 F. (S.D.N.Y. 2010) ("fee applications accompanied by contemporaneous time records . 17 . "). must be Plaintiff's counsel has submitted no time records reflecting the work they seek fees, expended. or evidence of the Accordingly, which hourly rates or the costs their request for the award of fees and costs is denied. CONCLUSION For the foregoing reasons, Plaintiff's Motion for Summary Judgment is granted. The Clerk shall enter judgment against Defendant for demurrage damages in the amount of $30,191, plus interest, calculated at the average short term T-bill rate for the period between May 6, 2010, and December 15, 2011. SO ORDERED. ;;> THEODORE H. KATZ UNITED STATES MAGISTRATE JUDGE Dated: December 15, 2011 New York, New York 18

Some case metadata and case summaries were written with the help of AI, which can produce inaccuracies. You should read the full case before relying on it for legal research purposes.

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.