# Petition for Writ of Certiorari — Mammoet Shipping B. V. v. Sky Shipping Ltd. > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386008_1362%3A1 ## Record - **Collection:** Supreme Court brief - **Document type:** Petition for Writ of Certiorari - **Published:** January 1, 1998 - **Citation:** 525 U.S. 962 ## Text PIEBD 98 204 JUL 301998 No. EME @E THE CLERK IN THE Supreme Court of the United States OCTOBER TERM, 1998 MAMMOET SHIPPING B.V., MopUL CARRIERS A.G. & Co. “TITAN SCAN” SCHIFFARTS K.G., and M/V TITAN SCAN, rm Petitioners, Sky SHIPPING LTD., anit Respondent, ITEL CONTAINER CORPORATION, ef al., Petition for a Writ of Certiorari to the United States Court of Appeals for the Eleventh Circuit PETITION FOR A WRIT OF CERTIORARI ROBERT S. GLENN, JR.* GEORGE M. EARLE HUNTER, MACLEAN, EXLEY & DUNN, P.C. Post Office Box 9848 Savannah, Georgia 31412 (912) 236-0261 Attorneys for Petitioners * Counsel of Record De TASMAN SEARS a ORR A TPOS ADT DNATA NI WILSON - Eras PRINTING Co., INC. - 789-0096 - WASHINGTON, D.C. 20001 QUESTION PRESENTED Whether, with respect to a bill of lading to which the United States Carriage of Goods by Sea Act (“U.S. COGSA”), 46 U.S.C. 1300, et seg., applies ex proprio vigore, the inclusion of a clause providing for “English law to apply” unambiguously evidences the ocean carrier’s consent to a liability limit higher than that provided by U.S. COGSA and results in the application of Eng- land’s Hague-Visby Rules where the clear language of the | bill of lading requires the application of Japanese | COGSA? (i) ii LIST OF PARTIES The parties to the proceedings below are those set forth in the caption. Pursuant to Rule 29.6 of the Rules of the Supreme Court of the United States, petitioners have no parent or subsidiary companies. ey aK wea at Fes QUESTIONS PRESENTED .. TABLE OF CONTENTS BEE, SANE NRA igh enlist bnimaincbinininhxtibtinsibiiaiilenesitiocins STATEMENT OF THE CASE .......... Ae ee ee ween ween eeee A. Statement Of Proceedings And Disposition In The Courts Below = B. Statement Of The Facts 1. 2. The first round of summary judgment motions The second round of summary judgment EEE SEE GP ca Slee a yo eae we eee The district court’s order and judgment The appeal to the Eleventh Circuit Court of (RES ES SUT IEE ES Ot CORO PP lieth eee ee Negotiation of the contracts of carriage........ a. The Candyline/Itel Booking Note and Bill Ne a b. The Candyline/Mammoet Booking Note eS es I an Hw Siti as TABLE OF CONTENTS—Continued Page REASONS FOR GRANTING THE PETITION I. THE COURT OF APPEALS’ INTERPRETA- TION AND APPLICATION OF U.S. COGSA §$1304(5) PRESENTS AN IMPORTANT QUESTION OF FEDERAL LAW UPON WHICH DISTRICT COURTS HAVE REACHED CONFLICTING RESULTS, THUS REQUIRING GUIDANCE FROM THIS 0.) 1): aN CRa Ean Canes eE ere oe te Le re 13 A. Application of U.S. COGSA ........-..-s0-se-se--e-0 13 B. Increasing the liability limit “by agreement’’.. 14 | C. Conflicting decisions of district courts ........... 15 Il. THE DECISION OF THE COURT OF AP- | PEALS IS ERRONEOUS AND DEPARTS } FROM THE ACCEPTED AND USUAL MAN- NER OF RESOLVING THE ISSUE PRE- | SENTED BY THIS CASE .......................000-...02-<- 19 | A. “English law to apply” does not result in the application of England’s Hague-Visby Rules.. 19 I FI coach sa siva seh da chines snpansinhinadinetigpich beng daminancent 23 Pg 1.11 eG Gee taiencrne Pen nein cameememe tr. >.> Faw la rE a one etonsebnaiotimnnnbinaaneces 14a IE, Sook on snore naccboagniaseananlacartionnions 16a Pe a iti cecdneeinrteiieeseriecatenbecgiinianhionsiidinscadtnes 45a Pe > 4 AER REN eT es PE OT or cians ae 47a ; Pg 51) | Gh SER RRRRE ICIS O50 Oe Paes OE. = Ee 105a | Vv TABLE OF AUTHORITIES Cases Page Associated Metals & Minerals Corp. v. M/V ARKTIS SKY, 1991 A.M.C. 1499 (S.D.N.Y. 1991), rev’d on other grounds, 978 F.2d 47 (2d tO + RUPE AS Te yet Shi ota aR ne a ae 17, 20 Associated Metals & Minerals Corp. v. M/V LUMBE, 1998 A.M.C. 700 (D.N.J. 1991) _......... 18 Associated Metals v. M/V STAR SKARVEN, 1995 A.M.C. 505 (S.D. Fla. 1994) 000.0000. 18 Daval Steel Products v. ACADIA FOREST, 1988 ASC. 1660 (6. DN.Y. 1008) lk... 17 Francosteel Corp. v. The DEPPE EUROPE, 1990 A.M.C. 2062 (S.D.N.Y.. 2900). ocscccnccccccscscisscecccies. 17, 19 Francosteel Corp. v. M/V KAPETAN ANDREAS G, 1993 A.M.C. 1924 (S.D.N.Y. 1998) ................ 15, 17 Francosteel Corp. v. M/V PAL MARINOS, 885 F. wee. OS CDN. 3. 2000) nck ea 17 Hellenic Steel Co. & Others v. Svolamar Shipping Co. Ltd. & Others, 1 Lloyd’s Rep. 370 (Ct. App. NOOR cesses ee cS 5 21 Ilva U.S.A., Inc. v. M/V BOTIC, 1998 A.M.C. 240 (E.D. Pa. 1992), aff’d, 1998 A.M.C. 2445 (8rd 2 Ae} PEREGO ananesr eM aie mameler 3:18) 18, 20 I.N.A. v. The ATLANTIC CORONA, 704 F. Supp. eT M.A | Seakraovanne can unl mer ame 17 I.N.A, v. The SEALAND DEVELOPER, 1990 A.M.C. 2967 (S.D.N.Y. 1089) ...:.-..cc.cccccsscsnasese 17 Itel Container Corp. v. M/V TITAN SCAN, 1997 A.M.C. 1568 (S.D. Ga. 1996), aff'd in part, rev’d in part, 189 F.2d 1450 (11th Cir. 1998) ............. 2 Lauritzen Reefers v. Ocean Reef Transport Ltd. S.A., 2 Lloyd’s Rep. 744 (Q.B. 1997) ............ 22, 23 Pyropower Corp. v. M/V ALPS MARU, 1998 Am 1668 -(2.D. Pa. 1008? ok es 18 Rockwell Int’l Corp. v. S/S KOELN EXPRESS, 1987 A.M.C. 2587 (D. Md. 1987) ......................... 18 Sunds Defibrator, Inc. v. M/V ATLANTIC STAR, 1986 A.M.C. 368 (S.D.N.Y. 1986) ................. 14, 16 Unimac Co., Inc. v. C.F. Ocean Serv., Inc., 43 F.3d Un Re CTY SOIT acces chicken as 13 —— vi TABLE OF AUTHORITIES—Continued Page Valmet Materials Handling Equip. Inc. v. Nedlloyd Lijnen B.V. Rotterdam, 1998 A.M.C. 1248 (M.D. SD RED eres en Cae EE ed 15 Statutes United States Carriage of Goods by Sea Act, 46 U.S.C. § 1300, et seq. NEE. OR Ee i CB UEG. § BGR CO ii. sk 14 Se es Te UN ibicencieitcicicaieiie a be 2,14 fe Ra bo: ay area eer TER eS 13 British Carriage of Goods by Sea Act................. 19, 20, 21 Japanese International Carriage of Goods by Sea SOUT iaisish ditinecMaiicindisidiicininsies ian cctthaasnih tea ese 19 Rules and Regulations at sv BOI sccndanlitiniictcdsncdpshticenasitenle date 3 Miscellaneous 2A Benedict on Admiralty § 41 at 5-2 (7th ed. MPR ieibotitihschisnisciiapindatbsichisinsatoh nie idesliciuacemuon ie 13 2A Benedict on Admiralty § 46 at 5-18 (7th ed RITE D idiiinbepiinasinstiiedhasindpiabaliuisiiniidatedibccia ciate Ae eee? 13 2A Benedict on Admiralty § 46 at 5-14 (7th ed. MAINE svciticihisninicisasnesiaiaeaipnbing tek dinaiden mene. titas 15 T. R. Jefferies, COGSA or Hague-Visby: Cargo Damages in International Shipments, 18 Hous. é. Intl i. 367, TOS (1906) 2S 16 A. Nakazawa and A. Moghaddam, Choice of For- eign Law Clauses in Bills of Lading, 17 Tul. Mar. Reb tar RR Ue an ae rae 14 W. Tetley, Acceptance of Higher Visby Liability Limits by U.S. Courts, 23 J. Mar. L. & Com. 55 CBD simnciicthiniscehinciccttchsibiinbtitaleshsceiiebd ashstitaasscaiiecs 16 . eee Ler a eee y ee In THE — Suytrene Court of the United States OcTOBER TERM, 1998 No. MAMMOET SHIPPING B.V., MoDUL CARRIERS A.G. & Co. “TITAN SCAN” ScHIFFARTS K.G., and M/V TITAN SCAN, . Petitioners, SKY SHIPPING LTD., esi Respondent,, ITEL CONTAINER CORPORATION, et al., Petition for a Writ of Certiorari to the United States Court of Appeals for the Eleventh Circuit PETITION FOR A WRIT OF CERTIORARI Petitioners Mammoet Shipping B.V. (“Mammoet”), Modul Carriers A.G. & Co. “Titan Scan” Schiffarts K.G. (“Modul”) and the M/V TITAN SCAN respectfully pray that a writ of certiorari issue to review the order and judgment of the United States Court of Appeals for the Eleventh Circuit entered in this proceeding. OPINIONS AND JUDGMENTS BELOW The United States Court of Appeals for the Eleventh Circuit entered its order and judgment on May 1, 1990, (App. A & B, infra). The opinion of the court of ap- 2 peals (App. A, infra, la-13a) is reported at 139 F.3d 1450 (11th Cir. 1998). The order and judgment of the United States District Court for the Sovthern District of Georgia (App. C & D, infra) are reported at 1997 A.M.C. 1568 (S.D. Ga. 1996). JURISDICTION The court of appeals entered its judgment on May 1, 1998. (App. B, infra, 14a-15a). The jurisdiction of this Court is invoked under 28 U.S.C. § 1254(1). STATUTORY PROVISION INVOLVED The U.S. COGSA package limitation provides in rele- vant part as follows: (5) Neither the carrier nor the ship shall in any event be or become liable for any loss or damage to or in connection with the transportation of goods in an amount exceeding $500 per package lawful money of the United States . . . unless the nature and value of such goods have been declared by the shipper before shipment and inserted in the bill of lading... By agreement between the Carrier, master, or agent of the carrier, and the shipper another maximum amount than that mentioned in this paragraph may be fixed .... 46 U.S.C. § 1304(5) (emphasis added). STATEMENT OF THE CASE A. Statement Of Proceedings And Disposition In The Courts Below. On or about January 23, 1992, Itel Container Corpor- ation (“Itel”) filed its complaint in the United States Wistrict Court for the Southern District of New York against the M/V TITAN SCAN, in rem, and against Modul Carriers A.G. & Co. “Titan Scan” Schiffarts K.G. 3 “(Modul”) and Sky Shipping Ltd. p/k/a Candyline Ltd. (“Candyline”), in personam, seeking to recover damages associated with the loss of 20 new refrigerated (“reefer” containers and physical damage sustained by 6 other new refrigerated containers. On or about July 8, 1993, Itel filed an amended complaint in the United States District Court for the Southern District of New York, naming as additional defendants Mammoet and Autoridad Portuaria Nacional (“Autoridad”).1 The district court had sub- ject matter jurisdiction pursuant to 28 U.S.C. § 1333. By order dated February 4, 1994, the lawsuit was trans- ferred from the United States District Court for the South- ern District of New York to the United States District Court for the Southern District of Georgia. 1. The first round of summary judgment motions. On March 13, 1995, Mammoet? filed a motion for par- tial summary judgment asserting that Itel’s cause of action was time-barred as against it or, alternatively, that the package limitation of U.S. COGSA, 46 U.S.C. § 1304(5), limited the liability of Mammoet to a maximum of $500.00 for each damaged or lost container. On May 5, 1995, Candyline filed a motion for partial summary judgment, adopting that portion of Mammoet’s motion for summary of judgment which supported the application of the U.S. COGSA package limitation. On May 5, 1995, Itel filed a memorandum of law in Opposition to Mammoet’s motion for partial summary judgment. Itel asserted that its cause of action against Mammoet was not time barred and, moreover, the applica- ble package limitation was the higher limitation of lia- bility of England’s Hague-Visby Rules, not the lower lim- 1 Autoridad is a stevedoring company which was never served with process in this lawsuit. As a result, Autoridad was dismissed from the lawsuit pursuant to Fed. R. Civ. P. 4(m). (App. A, infra, 3a n.2). 2 Except as noted specifically otherwise, Mammoet, Modul and the M/V TITAN SCAN may be referred to collectively as Mammoet. 4 itation of U.S. COGSA. On May 25, 1995, Itel filed its memorandum of law in opposition to Candyline’s motion for partial summary judgment. Itel asserted that the package limitation found in England’s Hague-Visby Rules governed the contract of carriage between Itel and Candy- line, not U.S. COGSA. By order dated June 30, 1995, the district court denied the defendants’ motions for partial summary judgment, concluding that unresolved evidentiary issues existed as to: (1) whether the parties to the respective contracts of carriage clearly agreed to increase the carriers’ liability limits beyond that of U.S. COGSA; and (2) the scope of the extension of suit time granted by Candyline to Itel (i.e., whether it included an extension of suit time from Mammoet to Itel). 2. The second round of summary judgment motions. On December 6, 1995, Mammoet filed its second mo- tion for partial summary judgment, asserting that Itel’s cause of action was time-barred as against it or alter- natively, that its liability was limited by the package lim- itation of either the Hague Rules, as enacted in Japan (“Japanese COGSA”), or U.S. COGSA. Itel filed a motion for summary judgment asserting that neither Jap- anese COGSA nor U.S. COGSA applied to Itel’s contract of carriage with Candyline; rather, the contract of car- riage was governed by either England’s Hague-Visby Rules or, alternatively, the 1924 Hague Convention. Candyline filed a motion for partial summary judgment against Mammoet, asserting that it was entitled to full indemni- fication, together with all costs and attorneys’ fees, for any judgment entered in favor of Itel against it. By order dated February 15, 1996, the district court ruled on the motions for summary judgment. The district court held as follows: (1) Candyline was entitled to in- demnity from Mammoet for any sums adjudged against Leen PPh Pn yl DNR iLO AMOR LAL DEA SA LER ES BALIN Z SIT iit at os aa 5 it, plus reasonable attorneys’ fees, but only up to the maximum liability of Mammoet pursuant to the liability limitation governing the contract of carriage between Candyline and Mammoet; (2) the contract of carriage between Itel and Candyline was governed by England's Hague-Visby Rules; (3) unresolved factual issues pre- cluded the district court' from determining which statu- tory regime governed the contract of carriage between Candyline and Mammoet; and (4) questions of fact re- mained as to whether Itel’s claim against Mammoet was time barred. The district court ruled that the case would “proceed to trial on the remaining issues of liability and the law applicable to the Candyline-Mammoet shipping agreement.” 3. The district court’s order and judgment. On September 3, 1996, a one-day bench trial was con- ducted, during which time the district court heard the deposition and live testimony of various witnesses, re- viewed numerous exhibits introduced into evidence by the parties, and heard arguments of counsel. By order dated October 24, 1996, the district court entered its findings of fact and conclusions of law. The district court ruled as follows: (1) Itel’s claims against Mammoet are time barred: (2) Candyline breached its contract of car- riage with Itel, but Candyline’s liability is limited by the package limitation of England’s Hague-Visby Rules; (3) Mammoet must indemnify Candyline for any damages Candyline pays Itel, but Mammoet'’s liability is limited by the package limitation of U.S. COGSA, which governs the contract of carriage between Candyline and Mam- moet: and (4) Itel did not prove a deviation from the contract of carriage sufficient to oust the applicable limi- tations of liability. (App. C, imfra, 43a). On February 20, 1997, the district court entered final judgment: (1) against Candyline and in favor of Itel in the amount of $385,136.96, representing $291,509.83, 6 calculated according to the liability limitation of Eng- land’s Hague-Visby Rules, plus prejudgment interest in the amount of $93,627.13; and (2) against Mammoet and in favor of Candyline in the amount of $73,145.47, representing $13,000.00, calculated according to the U.S. COGSA package limitation, prejudgment interest in the amount of $4,175.34, and reasonable attorney’s fees and costs in the amount of $55,970.13. (App. D, infra, 45a- 46a). 4. The appeal to the Eleventh Circuit Court of Appeals. Candyline filed its notice of appeal to the court of appeals on March 21, 1997. Appellate jurisdiction was grounded upon 28 U.S.C. § 1291. Neither Itel nor Mam- moet appealed from thhe proceedings below. On May 1, 1998, the court of appeals entered its order and judgment affirming in part and reversing in part the district court’s order and judgment. The court of appeals affirmed the district court’s determination that the Hague-Visby liabil- ity limit applies to the Candyline/Itel contract of carriage. The court of appeals reversed the district court’s finding that the U.S. COGSA liability limit governs the Mam- moet/Candyline contract of carriage. The court held that England’s Hague-Visby liability limit also applies to the Mammoet/Candyline contract of carriage. (App. A, infra, 13a). B. Statement Of The Facts. l. The Parties. Itel is, or was during the relevant time period, a con- tainer leasing company with a principal place of doing business in San Francisco, California. Candyline is, or was during the relevant time period, a non-vessel operat- ing common carrier (““NVOCC”) with its principal place of business in London, England. Modul is, or was during the relevant time period, a legal entity with an office c/o Mammoet-Hansa Linie A.G. in Bremen, Germany. Modul was the owner of the M/V TITAN SCAN during the ce?) a +4, A — 7 eS OS FO te eet 7 relevant time period. Mammoet is, or was during the relevant time period, a legal entity with its principal place of business in Amsterdam, The Netherlands. Mam- moet was the operator of the M/V TITAN SCAN during the relevant time period. The M/V *ITAN SCAN is the ocean-going vessel which transported Itel’s refrigerated containers from Yokohama, Japan, to Savannah, Georgia. 2. Negotiation of the contracts of carriage. In 1990, Itel purchased 198 new refrigerated contain- ers in Japan for use in international commerce. In August and September of 1990, following the purchase of the containers, Itel made arrangements to have the containers transported from Japan to the United States for distribu- tion to its customers. a. The Candyline/Itel Booking Note and Bill of Lading. To negotiate the ocean transportation of the containers Itel retained the services of Roger Cook, a London-based shipbroker engaged in the business of chartering whole vessels or space on vessels to charterers who have the need to hire vessels or space on vessels. Ite] had employd Mr. Cook on previous occasions to assist in “repositioning” containers purchased by Itel. Cook was a director at Mercury (London) Limited (“Mercury”), a ship broker- age service located in the Baltic Exchange Chambers in London, England. Mercury was owned by Brown Jenkin- son (Chartering) Ltd. (“Brown Jenkinson”), a ship brok- erage service also located in London, England. George Connides was an employee of Brown Jenkinson. At all material times, Mercury, Brown Jenkinson, Roger Cook and George Connides acted as Itel’s agents. In August of 1990, Kenneth Hurst, who was stationed in Itel’s San Francisco office, held the position of Direc- tor of Marketing and Administration for Itel. Ronald Howson was Itel’s Vice President for Europe, operating out of Itel’s office in the United Kingdom. Lisa Leach 8 was Itel’s Vice President and General Counsel. In nego- tiating the terms of the ocean carriage of the containers, Mr. Cook dealt “in the main” with Mr. Hurst. After being retained by Itel, Mr. Cook contacted Jona- than Marks, who shared office space with Mercury Ship- ping at the Baltic Exchange Chambers, in London, Eng- land. Mr. Marks was a director and ship broker at Prochart Services Ltd. (“Prochart”), a ship brokering company. Mr. Marks was also a director at Candyline. At all material times, Prochart acted as the agent for Candyline. Negotiations between Itel and Candyline for the car- riage of the containers were carried out by Mr. Cook, of Brown Jenkinson as agent for Itel, and Mr. Marks, of Prochart as agent for Candyline. After negotiations com- menced, Mr. Cook presented Mr. Marks with a “proforma booking note” previously employed by Itel for the car- riage of Itel’s containers aboard the M/V THALASSINI DOXA. The proforma booking note contained a number of clauses with a line running through them, indicating that all or a portion of clauses 5, 6, 7, and 10 of the proforma booking note had been deleted. This proforma booking note, with deletions, was presented to Mr. Marks for review by Candyline. On or about August 29, 1990, Mr. Cook forwarded a facsimile to Mr. Hurst, of Itel, in which Mr. Cook confirmed that Candyline had reviewed the proforma booking note and had submitted proposed “logical amendments” and “required alterations,” includ- ing an additional clause 10 requiring that “English law to apply.” After obtaining Mr. Hurst’s approval of the amend- ments and alterations proffered by Candyline, Mr. Cook had his secretary prepare the final draft of the booking note between Candyline and Itel. Candyline and Itel sub- sequently executed the final draft of the Conline Booking Note dated August 30, 1990 (“Itel/Candyline Booking Note”), for the transportation of Itel’s containers from tO ac BD ODL AE OTE OS MS at et Ny PASCAL Di RAGA CER © EERIE Set ESI SELLE CI 9 Yokohama, Japan, to Savannah, Georgia. Itel’s final ap- proval of the terms set forth in the Itel/Candyline Book- ing Note was provided to Mr. Cook by Mr. Hurst from his San Francisco office. Mr. Marks signed the Candyline Booking Note on behalf of Candyline while Mr. Howson signed on behalf of Itel. The Itel/Candyline Booking Note contains two pages labeled “additional clauses.” Clause 10, as set forth in these additional clauses, provides as follows: “English Law to apply.” This clause was inserted in the Candyline Booking Note at the request of Candyline. The Candyline Booking Note also contains an addendum, dated August 31, 1990, which altered the discharge port from Jackson- ville, Florida, to Savannah, Georgia. In September of 1990, Aall Barwil Agencies K.K. (“Barwil Japan”), Candyline’s agent in Japan, prepared a Liner Bill of Lading (“Itel/Candyline Bill of Lading”) which was signed by Yasushi Iwaishi, an employee of Barwil Japan, on behalf of Candyline. The Itel/Candy- line Bill of Lading obligated the “carrier” to transport the containers from Yokohama, Japan, to Savannah, Georgia. Itel (Tokyo) is named in the Itel/Candyline Bill of Lad- ing as the “shipper” and Itel (Charleston) is named as the “consignee.” The Itel/Candyline Bill of Lading pro- vides as follows: “Terms and Conditions as per Conline Booking Note Dated 30th August 1990.” The Itel/ Candyline Bill of Lading incorporates the calculation of freight set forth in the Candyline Booking Note. Clause 13 at Page 2 of the Itel/Candyline Booking Note provides as follows: “Freight payable to: Hambros Bank Ltd., 41 Tower Hill, London EC3N 4HA, ... .” An “excess value” for the containers was neither declared nor inserted in the Itel/Candyline Bill of Lading, and additional freight was not paid for the shipment of Itel’s containers aboard the M/V TITAN SCAN. On or about September 14, 1990, Itel paid the $207,900.00 freight due Cai.dyline to Candyline’s bank account at Hambros Bank Ltd., in Lon- don, England. 10 The original Itel/Candyline Bill of Lading was deliv- ered by Barwil Japan to Itel’s office in Tokyo, Japan, and was thereafter received by Itel’s Charleston office. The original Itel/Candyline Bill of Lading was subsequently surrendered by Itel’s Charleston office to Candyline’s agent in the United States, Barwil Agencies (Louisiana) Inc. (“Barwil Louisiana”), in consideration for the deliv- ery of the containers to Itel at Savannah. b. The Candyline/Mammoet Booking Note and Bill of Lading. During the course of Candyline’s negotiations with Itel, Candyline entered into negotiations with Mammoet for the carriage of the containers aboard the M/V TITAN SCAN. Itel and Mammoet had no direct dealings with each other during the time period during which the respec- tive contracts of carriage were negotiated. The negotiations between Candyline and Mammoet were initiated during a conversation on the floor of the Baltic Exchange between Mr. Marks and Lindsay Adams, the manager of Mammoet’s London office. Mammoet’s London office was also located in the Baltic Exchange Chambers. Mammoet’s London office served as a branch office for Mammoet’s principal office in Amsterdam, The Netherlands. Mammoet’s London office did not actually draft or negotiate the contracts of carriage, but forwarded all proposed contracts of carriage for review by Mam- moet’s Amsterdam office. After Mr. Marks advised Ms. Adams that Prochart had possible cargo business for Mammoet, Ms. Adams telephoned Mammoet’s Amsterdam office to determine whether Mammoet had any interest in the cargo. Mam- moet’s Amsterdam office responded in the affirmative, and negotiations commenced in earnest for the fixture. By telex dated August 28, 1990, Mammoet advised Prochart of its “firm offer” for the carriage of Candyline’s contain- ers. In this telex, Mammoet requested that Prochart pro- vide it with background information on Candyline. Mam- 11 moet sought this information because it had never before contracted with Candyline. Mr. Marks, by return telex dated August 28, 1990, set forth Candyline’s counter-offer to Mammoet’s firm offer. Mr. Marks suggested that the freight rate be reduced to $900 per container from the original $1,100 per container rate offered by Mammoet. Mr. Marks also provided back- ground information on Candyline, including Candyline’s registered office, bank, and trade references. Prochart and Mammoet continued to exchange telexes refining the major terms of the proposed contract of carriage between Candy- line and Mammoet. On or about August 29, 1990, Mr. Marks provided Mammoet’s London office with a copy of a proforma booking note for review. The booking note, as well as one page of additional clauses thereto, consisted of a copy of the proforma booking note from the M/V THA- LASSINI DOXA which Mr. Cook, on behalf of Itel, had previously provided to Mr. Marks during the negotiation of the Candyline Booking Note. The proforma booking note also consisted of a final page, entitled “Candyline/ Titan Scan,” setting forth additional alterations in the M/V THALASSINI DOXA proforma booking note. The last sentence of this last page contained the proposed ad- ditional clause 10, which provided that “English law to apply.” By facsimile dated August 29, 1990, Mammoet’s London office forwarded this proforma booking note, and proposed alterations thereto, to Mr. Jaap Slager, the sales manager in the commercial department of Mammoet’s Amsterdam office. In August or September of 1990, Candyline and Mam- moet executed a Conline Booking Note dated August 30, 1990 (“Candyline/Mammoet Booking Note”), for the transportation of the 198 containers from Yokohama, Japan, to Savannah, Georgia. The Candyline/Mammoet Booking Note was prepared by Prochart, on behalf of Candyline. In September of 1990, Nedlloyd Lines Agen- 12 cies K.K. (“Nedlloyd”), as agents for Mammoet in Japan, signed and delivered the original Liner Bill of Lading Number MSBV900200 (“Candyline/Mammoet Bill of Lading”) to Barwil Japan, Candyline’s agent in Japan. The Candyline/Mammoet Bill of Lading was prepared by Candyline’s agent, Barwil Japan, at the request of Mam- moet. The Candyline/Mammoet Bill of Lading obligated the “carrier” to transport the containers from Yokohama, Japan, to Savannah, Georgia. Candyline is named in the Candyline/Mammoet Bill of Lading as the “shipper” and Candyline’s American agent, Barwil Louisiana, is named as the “consignee.” The Candyline/Mammoet Bill of Lading provides as follows: “Terms and Conditions as per Conline Booking Note Dated 30th August 1990.” The Candyline/Mammoet Bill of Lading incorporates the calculation of freight set forth in the Candyline/Mammoet Booking Note. Clause 13 at Page 2 of the Candyline/ Mammoet Booking Note provides as follows: “Freight payable to: Mammoet Shipping B.V., Bank Account 54.03.75.020 Algemene Bank Nederland, N.V. Am- sterdam.” An “excess value” for the containers was neither de- clared nor inserted in the Candyline/Mammoet Bill of Lading, and additional freight was not paid for the ship- ment of the containers aboard the M/V TITAN SCAN. On or about September 14, 1990, Candyline paid the $181,046.25 freight due Mammoet to Mammoet’s bank account in Amsterdam, The Netherlands. 3. The voyage. Itel’s containers were loaded aboard the M/V TITAN SCAN at Yokohama, Japan, in September of 1990, des- tined for discharge in Savannah, Georgia. While en route to Savannah, however, the vessel encountered confused seas, with the result that 20 containers were lost over- board and 6 other containers sustained physical damage. 13 REASONS FOR GRANTING THE PETITION At the district court level, the question presented by this petition has generated conflicting decisions which continue to proliferate and the need for guidance from this Court is acute. This case presents a timely oppor- tunity to provide that guidance. Moreover, the decision below is erroneous and the issue that it addresses is important. I. THE COURT OF APPEALS’ INTERPRETATION AND APPLICATION OF U.S. COGSA § 1304(5) PRE- SENTS AN IMPORTANT QUESTION OF FEDERAL LAW UPON WHICH DISTRICT COURTS HAVE REACHED CONFLICTING RESULTS, THUS RE- QUIRING GUIDANCE FROM THIS COURT. A. Application of U.S. COGSA. U.S. COGSA “is a comprehensive statute intended to limit the liability of carriers engaged in international shipping.” Unimac Co., Inc. v. C.F. Ocean Serv., Inc., 43 F.3d 1434, 1436 (11th Cir. 1995). U.S. COGSA applies ex proprio vigore “to all contracts for carriage of goods by sea to or from ports of the United States in foreign trade.” 46 U.S.C. § 1312. “Foreign trade” is defined as “the transportation of goods between the ports of the United States and ports of foreign countries.” I/d. This is so despite conflicting contract terms or foreign legal systems. “Under U.S. law, [U.S.] COGSA is com- pulsorily applicable, regardless of any provision to the contrary in the bill of lading or any rule to the contrary under foreign law. The parties do not have the freedom to displace [U.S.] COGSA with another regime... .” 2A Benedict on Admiralty § 46 at 5-13 (7th ed. 1996); see also 2A Benedict on Admiralty § 41 at 5-2 (noting that while for most shipments to the United States more than one legal regime will be compulsorily applicable, United States courts are bound to apply U.S. COGSA). 14 B. Increasing the liability limit “by agreement.” Section 1303(8) of U.S. COGSA prohibits clauses in bills of lading which relieve a carrier from liability for its negligence or fault, or that lessen its liability “other- wise than as provided” in U.S. COGSA. 46 U.S.C. § 1303(8). The U.S. COGSA package limitation, section 1304(5), provides in relevant part as follows: (5) Neither the carrier nor the ship shall in any event be or become liable for any loss or damage to or in connection with the transportation of goods in an amount exceeding $500 per package lawful money of the United States . . . unless the nature and value of such goods have been declared by the shipper before shipment and inserted in the bill of lading... By agreement between the carrier, master, or agent of the carrier, and the shipper another maximum amount than that mentioned in this paragraph may be fixed.... 46 U.S.C. § 1304(5) (emphasis added). U.S. COGSA § 1304(5) limits the liability of the carrier to $500 per package or customary freight unit unless (1) the shipper declares the value of the goods and inserts that information in the bill of lading, or (2) the carrier and shipper establish a higher liability limit “(bly agreement.” Sunds Defibrator, Inc. v. M/V AT- LANTIC STAR, 1986 A.M.C. 368 (S.D.N.Y. 1986). Neither U.S. COGSA nor its legislative history defines the term “agreement.” See A. Nakazawa and A. Moghad- dam, COGSA and Choice of Foreign Law Clauses in Bills of Lading, 17 Tul. Mar. L.J. 1, at 4 n.16 (1992). “Black’s Law Dictionary defines ‘agreement,’ . . . as ‘the coming together in accord of two minds on a given prop- osition.” The test, therefore, is whether the parties in fact contemplated and intended a higher limitation of liability to govern their relationship.” /d. 15 The analysis of whether such an “agreement” exists must begin with the presumption that where, as here,® U.S. COGSA applies ex proprio vigore to the bill of lading, then U.S. COGSA governs. If the shipper argues for a higher liability limit than that contained in U.S. COGSA, it must show that the parties agreed to it in the contract of carriage. The effectiveness of a shipper’s argument to impose the higher Hague-Visby liability limit generally depends on the clarity with which the clause paramount calls for the application of the Hague-Visby Rules. 2A Benedict on Admiralty § 46 at 5-14. If the clause paramount is irretrievably ambiguous the U.S. COGSA liability limit is applied because there is no clear intent to allow a liability limit different than that set by law. Valmet Materials Handling Equip. Inc. v. Nedlloyd Lijnen B.V. Rotterdam, 1993 A.M.C. 1243 (M.D. Fla. 1993); Francosteel Corp. v. M/V KAPETAN AN- DREAS G, 1993 A.M.C. 1924 (S.D.N.Y. 1993). C. Conflicting decisions of district courts. The recurring issue presented in the present lawsuit is as follows: in a lawsuit against a carrier for cargo dam- age, which liability limit applies—the lower U.S. COGSA limit or the more generous Hague-Visby limit? Many dis- trict court decisions have addressed this issue, albeit with inconsistent results: A line of cases, predominantly from the Southern District of New York, holds that a Clause Para- mount in an international bill of lading that ex- pressly mentions both COGSA and the Hague-Visby Rules incorporates Hague-Visby’s higher carrier lia- bility limits. The Clauses Paramount discussed in these cases generally maintain that the contract of carriage is controlled by either COGSA or the 3 Because this lawsuit involves the shipment of goods from Japan to the United States, U.S. COGSA governs the contracts of carriage ex proprio vigore. 16 Hague-Visby Rules. However, the two regimes in- corporate different levels of package liubility limi- tation, with Hague-Visby allowing the shipper a greater recovery against the carrier. Courts gene- ally hold that COGSA applies ex proprio vigore but sometimes still allow the conflict between COGSA and the Hague-Visby liability limits to be resolved in favor of the shipper by allowing for the higher Hague-Visby recovery. Courts arrive at this conclu- sion by one of two analytical paths. First, some courts have held that the bill of lading is ambiguous because the Clause Paramount makes reference to Hague-Visby and so it must be construed against the carrier (who is usually the drafter). Other courts have held that because Hague-Visby allows a higher recovery, any reference to Hague-Visby in the bill of lading constitutes the carrier’s “agreement” to accept the higher package liability scheme. Neither analysis withstands careful scrutiny. T. R. Jefferies, COGSA or Hague-Visby: Cargo Damages in International Shipments, 18 Hous. J. Int’l L. 767, 769 (1996); see also W. Tetley, Acceptance of Higher Visby Liability Limits by U.S. Courts, 23 J. Mar. L. & Com. 55 (1992). District courts, reviewing the express language of sim- ilar clauses paramount in the bills of lading before them, have reached conflicting results. See Tetley, 23 J. Mar. L. & Com. at 55, 58 (noting that of six opinions from the Southern District of New York addressing this issue, the courts have reached conflicting results, with four decisions applying the higher of liability limit of Hague-Visby and two refusing to do so); Sunds Defibrator, Inc. v. The Atlantic Star, 1986 A.M.C. 368 (S.D.N.Y. 1983) (in shipment from Sweden (a Hague-Visby nation) to the United States, the district court, in construing clause paramount providing that the “Hague Rules . . . dated 25th August 1924, and any legislation making those rules compulsorily applicable to this Bill of Lading including 17 [COGSA] . . .,” denied the higher Hague-Visby limit on the basis there was no clear reference to the Hague Visby Rules); Daval Steel Products v. ACADIA FOR- EST, 1988 A.M.C. 1669 (S.D.N.Y. 1988) (in shipment from Belgium to United States, court concluded clause paramount incorporated higher Hague-Visby limitation) ; I.N.A. v. The ATLANTIC CORONA, 704 F. Supp. 528 (S.D.N.Y. 1989) (in construing bill of lading similar to that of ATLANTIC STAR, the court held that the higher limitation of Hague-Visby applied); /.N.A. v. The SEA- LAND DEVELOPER, 1990 A.M.C. 2967 (S.D.N.Y. 1989) (court denied higher WHague-Visby limitation where bill of lading for shipment from the United King- dom to the United States referred to “a compulsorily applicable Carriage of Goods by Sea Act, ordinance or statute similar to [the Hague Rules]”); Francosteel Corp. v. The DEPPE EUROPE, 1990 A.M.C. 2962 (S.D.N.Y. 1990) (court allowed higher Hague-Visby limitation in shipment from Belgium to Puerto Rico where bill of lading referred to a compulsory carriage of goods by sea act along with the “rules thereto annexed”); Associated Metals & Minerals Corp. v. The ARKTIS SKY, 1991 A.M.C. 1499 (S.D.N.Y. 1991) (in shipment from Spain to United States, court allowed higher Hague-Visby lim- itation where bill of lading provided that the Hague Rules, as enacted in the country of shipment, would apply and that in trades where the Hague-Visby Rules applied compulsorily, “the provision of the respective legislation would be considered incorporated in the bill of lading); Francosteel Corp. v. M/V KAPETAN AN- GREAS G, 1993 A.M.C. 1924 (S.D.N.Y. 1993) (court found material issues of fact remaining with respect to the parties’ intent to apply a higher limitation of liability than that of U.S. COGSA); Francosteel v. MV/ PAL MARINOS, 885 F. Supp. 86 (S.D.N.Y. 1995) (in ship- ment from Belgium to the United States, court found clause paramount ambiguous and therefore, construing 18 ambiguity against the carrier as drafter of the bill of lading, held that higher Hague-Visby limitation applied). District courts in other jurisdictions have also reached conflicting results on whether a clause paramount re- quires application of the higher liability limit provided by the Hague-Visby Rules. See Rockwell Int'l Corp. v. S/S KOELN EXPRESS, 1987 A.M.C. 2537 (D. Md. 1987) (in shipment from Germany to the United States, where bill of lading provided for the application of the Hague Rules or the Hague-Visby Rules, whichever was “com- pulsorily applicable to the contract,” the court refused to apply higher Hague-Visby limitation because U.S. COGSA applied ex proprio vigore); Associated Metals & Minerals Corp. v. M/V LUMBE, 1993 A.M.C. 700 (D.N.J. 1991) (without citation to supporting authority, court held that in shipment from Argentina to the United States, plain language of bill of lading’s clause paramount amounted to an agreement to a higher liability limit than that provided by U.S. COGSA); Ilva U.S.A. v. M/V BOTIC, 1993 A.M.C. 240 (E.D. Pa. 1992), aff'd, 1993 A.M.C. 2445 (3d Cir. 1993 (in shipment from Italy to the United States, court held that Hague-Visby liability limitation applied because clause paramount called for application of laws enacted in country of shipment and here, Italy had enacted Hague-Visby); Pyropower Corp. v. M/V ALPS MARU, 1993 A.M.C. 1562 (E.D. Pa. 1993) (in shipment from Korea to United States, court applied U.S. COGSA, albeit by virtue of analysis under Hague-Visby Rules as enacted in The Netherlands): As- sociated Metals v. M/V STAR SKARVEN, 1995 A.M.C. 505 (S.D. Fla. 1994 )(relying upon the reasoning of the district courts in M/V BOTIC and ARKTIS SKY, the court held that because the country of shipment, Finland, had adopted the Hague-Visby Rules, Hague-Visby limitation would apply pursuant to the express language of the clause paramount). 19 Guidance is required from this Court to permit con- sistent resolution of the issue of which limitation governs a carrier’s liability when U.S. COGSA applies to a bill of lading ex proprio vigore. The parties to a bill of lading should be assured of their potential liabilities at the time and place of issuance of the bill of lading. M/V DEPPE EUROPE, 1990 A.M.C. at 2964. Il. THE DECISION OF THE COURT OF APPEALS IS ERRONEOUS AND DEPARTS FROM THE AC- CEPTED AND USUAL MANNER OF RESOLVING THE ISSUE PRESENTED BY THIS CASE. The district court cases cited above share one common feature: reliance upon the express language of the bill of lading’s clause paramount to determine which liability limit governs the bill of lading. The court of appeals in the present matter erred by first recognizing, then disre- garding the clear and unambiguous language of the clause paramount in the Candyline/Itel and Mammoet/Candy- line contracts of carriage. The court of appeals eschewed the clear language of the clause paramount because clause 10 of the booking notes and bills of lading provides that “English law to apply.” The court of appeals reasoned that the application of English law necessarily required the application of England’s Hague-Visby Rules and there- fore a higher liability limit. The court’s analysis is flawed because under English law, a court would be re- quired to rely upon the clear language of the clause para- mount which, as conceded by the court of appeals, calls for the application of Japanese COGSA. A. “English law to apply” does not result in the appli- cation of England’s Hague-Visby Rules. Clause 2, the general paramount clause of the Mam- moet/Candyline Booking Note and Bill of Lading, pro- vides as follows: 2. General Paramount Clause. The Hague Rules contained in the International Convention for the Unification of certain rules relat- 20 ing to Bills of Lading, dated Brussels the 25th of August 1924 as enacted in the country of shipment shall apply to this contract. When no such enact- ment is in force in the country of shipment, the corresponding legislation of the country of destina- tion shall apply, but in respect of shipments to which no such enactments are compulsorily applicable, the terms of the said Convention shall apply. Trades where Hague-Visby Rules apply: In trades where the International Brussels Conven- tion 1924 as amended by the Protocol signed at Brussels on February 23rd 1968—The Hague-Visby Rules—apply compulsorily, the provisions of the re- spective legislation shall be considered incorporated in this Bill of Lading. The Carrier takes all reserva- tions possible under such applicable legislation, re- lating to the period before loading and after dis- charging and while the goods are in the charge of another Carrier, and to deck cargo and live animals. (App. A, infra, 8a (emphasis added)). The court of ap- peals concluded correctly that “[a]ccording to the first paragraph of the General Paramount Clause, the Hague Rules as enacted by Japan would be incorporated into the Bill of Lading.” (App. A, infra, 9a). The court of ap- peals’ interpretation of the general paramount clause is supported by other district courts and other circuit courts of appeals addressing the identical clause paramount. See M/V BOTIC, 1993 A.M.C. 240 (E.D. Pa. 1992), affd, 1993 A.M.C. 2445 (3rd Cir. 1993); M/V ARKTIS SKY, 1991 A.M.C. 1499 (S.D.N.Y. 1991), rev’d on other grounds, 978 F.2d 47 (2d Cir. 1992). Despite the clear language of the clause paramount, which would result in the application of Japanese COGSA, the court of appeals, citing clauses 3 and 10 of the bill of lading as pointing toward the application of English law, held that the phrase “English law to apply” would result in the application of England’s Hague- Visby Rules. In so ruling, the court of appeals failed to 21 engage in the analysis of whether, under English law, England’s Hague-Visby Rules would apply to the Mammoet/Candyline Booking Note and Bill of Lading. At trial, Mammoet introduced without objection the affidavit of Martin Wisdom, an English solicitor retained by Candyline to address whether the “English law to apply” provision of the respective booking notes and bills of lading results in the compulsory application of Eng- land’s Hague-Visby Rules. Mr. Wisdom offered his opin- ion on the following issue: “Whether the English Car- riage of Goods by Sea Act 1971 and therefore the Hague- Visby rules are incorporated into the contract by carriage by necessary inference from the fact that the terms of the contract of carriage provide for English law to be appli- cable.” (App. E, infra, 48a). Mr. Wisdom, relying upon the English Court of Appeal’s decision in Hellenic Steel Co. & Others v. Svolamar Shipping Co. Ltd. & Others, 1 Lloyd’s Rep. 370 (Ct. App. 1991) (hereinafter referred to as “the KOMINOS S”), and upon an authoritative text discussing the KOMINOS S, concludes that the “English law to apply” provision of the Mammoet/Candyline Booking Note and Bill of Lading would not be sufficient to result in compulsory application of the England’s Hague-Visby Rules. (App. E, infra, 56a). Mr. Wisdom notes that an English court, in determin- ing which version of the Hague Convention would apply, would examine the general paramount clause of the bill of lading which, in the present case, is found at Clause 2 of the Mammoet/Candyline Booking Note and Bill of Lad- ing. Mr. Wisdom’s opinion comports with that of the court of appeals in concluding that the clause paramount in the Mammoet/Candyline Booking Note and Bill of Lading would call for the application of Japanese COGSA.- (App. A, infra, 9a). Mr. Wisdom concludes that “[c]lonsequently, . . . an English Court applying English law would be bound to hold that the United 22 Kingdom Carriage of Goods by Sea Act 1971 and the Hague-Visby Rules are not incorporated into the contract of carriage. (App. E, infra, 56a). Mr. Wisdom’s affidavit is reinforced by a decision of the Queen’s Bench Division (Commercial Court) which was handed down on June 5, 1997, after the trial in this case, and which was submitted to the court of appeals by Candyline. The decision, Lauritzen Reefers v. Ocean Reef Transport Ltd. S.A., 2 Lloyd’s Rep. 744 (Q.B. 1997) (hereinafter “the BUKHTA RUSSKAYA"), in- volved the construction of a clause paramount in a charter party which, like that in the present matter, contained the following essential terms: “(1) if the Hague Rules are enacted in the country of shipment, then they apply as enacted; (2) if the Hague Rules are not enacted in the country of shipment, the corresponding legislation of the country of destination applies or, if there is no such legislation, the terms of the Convention containing the Hague Rules apply: (3) if the Hague-Visby Rules are compulsorily applicable into the trade in question, then the legislation enacting those rules applies.” BUKHTA RUSSKAYA, 2 Llioyd’s Rep. at 746; (see App. F, infra, 113a). Moreover, as with the contract of carriage in the present case, the charter party provided that it was gov- erned by English law. BUKHTA RUSSKAYA, 2 Lloyd’s Rep. at 745; (App. F, infra, 114a). The charterers argued that England’s Hague-Visby Rules applied to the charter party because the charter party provided that it was governed by English law. BUKHTA RUSSKAYA, 2 Lloyd’s Rep. at 746; (App. F, infra, 112a). The charterers reasoned that because Eng- lish law was the “overriding regime” applicable to the charter party, the Hague-Visby Rules applied as the “rele- vant overriding regime.” /d. Justice Thomas rejected the charterers’ argument and ruled that, pursuant to the ex- press language of the clause paramount, the Hague Rules, as enacted in the country of shipment (Mauritania) or, 23 alternatively, the country of destination (Japan), gov- erned. BUKHT'A RUSSKAYA, 2 Lloyd’s Rep. at 747; (App. F, infra, 114a). Justice Thomas ruled that the clear language of the clause paramount determined which law was applicable, not the charter party’s provision that English law governed. Id. CONCLUSION For the reasons set forth above, the petition for a writ of certiorari should be granted. Respectfully submitted, RoBERT S. GLENN, JR.* GEORGE M. EARLE HUNTER, MACLEAN, EXLEY & DUNN, P.C. Post Office Box 9848 Savannah, Georgia 31412 (912) 236-0261 Attorneys for Petitioners * Counsel of Record la APPENDIX A UNITED STATES COURT OF APPEALS ELEVENTH CIRCUIT No. 97-8278 ITEL CONTAINER CORPORATION, Plaintiff-Appellee, Vv. M/V “TITRAN SCAN”, her engines, boilers, etc.; Mopbut Carriers A.G. & Co., TITAN SCAN” SCHIFFAHRTS K. G.; MAMMOET SHIPPING, B. V., Defendants-Cross- claimants-A ppellees, Sky SHIPPING LTD. f.k.a. CANDYLINE LTD., Dejfendant-Cross- claimant-A ppellant. Appeal from the United States District Court for the Southern District of Georgia May 1, 1998 Before COX, DUBINA and BLACK, Circuit Judges. COX, Circuit Judge: Sky Shipping Ltd., formerly known as Candyline Ltd. (“Candyline”) appeals following the district court’s judg- ment finding the liability limits of the English Hague- 2a Visby Rules applicable to Candyline’s contract of car- riage with Itel Container Corporation (“Itel”) and the liability limits of the United States Carriage of Goods by Seas Act (U.S.COGSA) applicable to Candyline’s contract of carriage with Mammoet Shipping B.V. (“Mam- moet”). We affirm in part, reverse in part, and remand. I. BACKGROUND Itel is a container leasing company. In 1990, Itel purchased 198 refrigerated containers in Japan for use in international commerce. Subsequently, Itel negotiated with a representative from Candyline for the shipment of the containers from Japan to Savannah, GA. Candy- line operates as a non-vessel operating common carrier— an entity that contracts with a shipper as carrier, but then enters into a separate agreement with a vessel owner or charterer for actual carriage of the shipper’s cargo. After negotiating the contract, Itel received a signed copy of a Conline Booking Note evidencing the terms and condi- tions of the shipment. Along with the boilerplate terms, the Booking Note contained an addendum with additional typewritten terms, including Clause 10, which states “English law to apply.” Candyline’s agent in Japan then prepared and delivered to Itel’s Japanese agent a Liner Bill of Lading. The Bill of Lading incorporated by reference the Booking Note, stating “Terms and Condi- tions as per Conline Booking Note Dated 30th August, 1990.” (R.2-46-5, 6 at § 24). The Bill of Lading con- tained a General Paramount Clause providing for the application of the Hague Rules in some situations and for the incorporation of Hague-Visby Rules in others, where applicable. Clause 3 of the Bill of Lading was a 1The Hague Rules arose from the International Convention of 1924 and were ratified in the United States in 1937. The United States Carriage of Goods by Sea Act (U.S.COGSA) represents the domestic enabling of the Hague Rules. The “Protocol to Amend the Hague Rules of 1924,” or the Visby Amendments, were drafted in 1968 and were not adopted by the United States. These Amend- 3a forum selection clause providing for any disputes arising under the Bill of Lading to be decided in the country where the carrier has its principal place of business, under that country’s laws. Candyline’s principal place of business was in England. As a non-vessel operating common carrier, Candyline contracted with Mammoet for the actual carriage of the containers. Mammoet managed the M/V TITAN SCAN, which was owned by Modul Carriers A.G. & Co. (“Mo- dul”). Candyline and Mammoet executed a Conline Booking Note and Bill of Lading containing terms iden- tical to those found in the Itel/Candyline agreement with the sole exception of the cost of the freight. The Bill of Lading was issued in Japan, and like the Itel/Candyline Bill of Lading, provided for “Terms and Conditions as per Conline Booking Note Dated 30th August 1990.” The containers were transported from Japan to Pan- ama without incident. In Panama, the ship made an unscheduled stop and the containers were restowed. Dur- ing the trip from Panama to Savannah, the containers came loose during heavy weather. Twenty were lost over- board and six others severely damaged. Itel sued the M/V TITAN SCAN, in rem, and Candy- line, Modul, Mammoet, and Autoridad Portuaria Na- cional, in personam, seeking to recover damages for the lost and physically damaged containers.* Candyline then filed a cross-claim for indemnity against Mammoet. The district court held that Itel was entitled to recover dam- ments raised the per package limitation on liability. See Associated Metals & Minerals Corp. v. M/V ARKTIS SKY, 1991 A.M.C. 1499 (S.D.N.Y.1991). During the relevant time period, England had adopted the Visby Amendments, or Hague-Visby Rules, and Japan had not. (R.4-85-17). 2 Autoridad is a stevedoring company that was never served with process and was therefore dismissed from the lawsuit pur- suant to Fed. R.Civ.P. 4(m). Itel’s claims against Modul, Mam- moet, and the TITAN SCAN are not at issue in this appeal. i I a a 4a ages from Candyline and that Candyline’s liability was determined by the Hague-Visby Rules, a statutory regime adopted in England that provides higher liability limits than United States law provides. The district court also held that Candyline was entitled to indemnity from Mam- moet, but that Mammoet’s liability was limited by the U.S. COGSA. Because the U.S. COGSA contains a lower cap on liabiilty than the Hague-Visby Rules, Candyline was not indemnified the full amount Candyline paid Itel. Il. CONTENTIONS OF THE PARTIES The parties do not dispute that Candyline breached its contract with Itel and therefore stands liable to Itel, or that Mammoet must indemnify Candyline as limited by the relevant statutory scheme. Rather, Candyline contends that the distirct court erred in concluding that Candy- line’s liability to Itel was subject to the liability limits of the Hague-Visby Rules as enacted in England, whereas Mammoet’s indemnity to Candyline was restricted by the liability limits contained in the U.S. COGSA. Candyline argues that there is no legal basis for distinguishing be- tween the Itel/Candyline and Candyline/Mammoet agree- ments and that they were intentionally created as “back to back” contracts to be governed in all aspects by the same statutory regime. Candyline also asserts that the district court erred in finding the liability limits contained in the Hague-Visby Rules applicable to the Itel/Candyline con- tract. Candyline maintains that while the district court correctly found that the parties intended that English law be used to determine the controlling liability scheme for the Itel/Candyline contract, the district court incorrectly concluded that English law calls for the application of the liability limits of the Hague-Visby Rules. Instead, Candy- line asserts that under English law, the liability limits of the Japanese COGSA, which did not adopt the Hague- Visby Rules, would apply. Itel maintains that Candyline’s liability under the Itel/ Candyline agreement should be governed by the English 5a Hague-Visby Rules, arguing that Clause 10 of the Book- ing Note (“English law to apply”) and Clause 3 of the Bill of Lading (forum selection clause) mandate the application of English law. Itel also contends that its contract with Candyline falls within the purview of Arti- cle X(c) of the Hague-Visby Rules, calling for the appli- cation of those rules when the contract contained in or evidenced by the bill of lading so provides.* Because Mammoet was not a party to the Itel/Candy- line agreement, it does not address the district court’s conclusion that the liability limits of the Hague-Visby Rules apply to that agreement. Instead, Mammoet urges this court to affirm the district court’s determination that the Itel/Candyline and Candyline/Mammoet contracts must be construed separately and that the liability limits contained in the U.S. COGSA applies to the Candyline/ Mammoet contract. Mammoet notes that Candyline failed to include in the agreement with Mammoet any language suggesting the existence of a “pass through” liability scheme or “back to back” agreement. Further, Mammoet maintains that the Candyline/Mammoet agreement does not evidence a clear intent to abrogate the liability limits of the U.S. COGSA in favor of a higher liability limit. Iff. DISCUSSION U.S. COGSA aplies compulsorily “to all contracts foi’ carriage of goods by sea to or from ports of the Unite 3 Article X of the British Carriage of Goods by Sea Act of 1971 states: The provisions of these Rules (Hague-Visby] shall apply to every bill of lading relating to the carriage of goods between ports in two different States if: (a) the bill of lading is issued in a contracting State, or (b) the carriage is from a port in a contracting State, or (c) the contract contained in or evidenced by the bill of lading provides that these Ruules or legislation of any State giving effect to them are to govern the contract. 6a States in foreign trade.” 46 U.S.C.App. § 1312. USS. COGSA provides that neither the carrier nor the ship are liable “for any loss or damage to or in connection with the transportation of goods in an amount exceeding $500 per package . . . unless the nature and value of such goods have been declared by the shipper before shipment and inserted in the bill of lading.” 46 U.S.C.App. § 1304(5). U.S. COGSA permits the parties to agree by contract to a higher liability limit. However, the parties’ intent to apply the higher limit must be clear; if the question of whether the parties agreed to a higher liability limit is “irretrievably ambiguous,” then U.S. COGSA applies by default. See Valmet Materials Handling Equip., Inc. v. Nedlloyd Lijnen B.V. Rotterdam, 1993 A.M.C. | 1243, 1246 (M.D.Fla.1993). _ The district court concluded that, with respect to the Itel/Candyline contract, the Hague-Visby statutory scheme as enacted in England provided the appropriate cap on Candyline’s liability to Itel. In making this determination, the district court considered that (1) the Bill of Lading was issued in Japan; (2) Candyline, the “carrier” for purposes of the transaction, had its principal place of business in England; (3) previous courts had construed the same General Paramount Clause as evidencing an intent to agree to a higher liability limit; and (4) Clause 10 (“English law to apply”) incorporated a foreign legal regime with a higher liability limit than that under U.S. COGSA. With respect to the Candyline/Mammoet contract, the district court rejected Candyline’s argument that the two contracts stood “back to back,” thereby creating a “pass through” liability scheme. The court then concluded that unlike the Candyline/Itel agreement, the Candyline/ Mammoet agreement did not evidence an intent to abro- gate the package limitations contained in the U.S. COGSA in favor of a foreign regime with higher liability limits. The court noted that the “carrier” for purposes of the Candyline/Mammoet agreement was Mammoet, whose 7a principal place of business is Amsterdam. Thus, while the presence of Clause 3 (forum selection clause) in the Itel/ Candyline Bill of Lading suggested the application of British law, it did not with respect to the Candyline/ Mammoet agreement. The court also noted that the lan- guage of Clause 10 of the Booking Note (“English law to apply”) is ambiguous and is not, in itself, dispositive of the parties’ intent to displace the liability limits of the U.S. COGSA. Accordingly, because Clause 10 called for the application of English law, Clause 2 (General Para- mount Clause) pointed in the direction of Japanese COGSA, and Clause 3 (forum selection clause) called for the application of Dutch law, the court held that Candyline failed to meet its burden of proving Mam- moet’s unqualified assent to a limit above the $500 ceil- ing. Thus, Mammoet’s reimbursement to Candyline for the damages Candyline paid Itel was restricted by the liability limits of the U.S. COGSA. The district court’s findings of fact shall not be set aside unless clearly erroneous. See Reich v. Dep't of Conservation & Natural Resources, 28 F.3d 1076, 1082 (11th Cir. 1994). We review the district court’s applica- tion of law to the facts of the case de novo. See id. at 1083 (citing Massaro v. Mainland Section 1 & 2 Civic Ass'n, Inc., 3 F.3d 1472, 1475 (11th Cir.1993) ). A. Are the Itel/Candyline and Candyline/Mammoet Agreements Separate Transactions? We agree with the district court’s conclusion that the Itel/Candyline and Candyline/Mammoet contracts must be evaluated as two separate transactions. The evidence is undisputed that Itel and Mammoet had no communica- tion during the negotiation of the respective contracts of carriage. Further, while Candyline insists that its intent in structuring the contracts identically was to create a “pass through” system of liability, Candyline failed to in- clude language to that effect in the Candyline/Mammoet agreement. Looking at the language of the contract, we 8a find no evidence to support Candyline’s assertion that the ! two contracts must be evaluated as a single transaction. | Our analysis does not end, however, with the determi- nation that the contracts must be evaluated separately. The real question we must answer is whether the district court correctly concluded that the differences in the Itel/ Candyline contract and the Candyline/Mammoet con- tract justify the application of different liability limita- tions. B. Do the Liability Limits of the English Hague-Visby Rules Apply to the Itel/Candyline Agreement? We first consider whether the district court correctly concluded that Hague-Visby Rules, as enacted in England, govern the amount of Candyline’s liability to Itel pursuant to the Itel/Candyline contract. Relevant to our determi- nation is Clause 2 of that contract, the General Para- mount Clause, which provides: The Hague Rules contained in the International Con- vention for the Unification of certain rules relating to Bills of Lading . . . as enacted in the country of shipment shall apply to this contract. When no such enactment is in force in the country of shipment, the corresponding legislation of the country of destination shall apply, but in respect to shipments to which no such enactments are compulsorily applicable the terms of the said Convention shall apply. Trades where Hague-Visby Rules apply. In trades where . . . the Hague-Visby Rules [ ] apply compulsorily, the provisions of the respective legis- lation shall be considered incorporated in this Bill of Lading. The Carrier takes all reservations possible under such applicable legislation, relating to the pe- riod before loading and after discharging and while the goods are in charge of another Carrier, and to deck cargo and live animals. a mere mane Ene T OO TS Cree erero rope emer anwneceOeewuRewmN te 9a Also relevant to our determination is Clause 3 of the Bill of Lading, which provides: Any dispute arising under the Bill of Lading shall be decided in the country where the carrier has his principal place of business, and the laws of such country shall apply except as provided elsewhere herein. The district court noted that in the past, General Para- mount Clauses identical to this one have been interpreted as an agreement between the parties to have a liability limit higher than that provided under U.S. COGSA. See Associated Metals & Minerals Corp. v. M/V ARKTIS SKY, 1991 A.M.C, 1499 (S.D.N.Y.1991); Pyropower Corp. v. M/V ALPS MARU, 1993 A.M.C. 1562 (E.D. Pa.1993). However, while it is true that in those cases, the General Paramount Clause was interpreted to allow for a higher limit of liability, those cases stand for the proposition that where the Hague-Visby Rules were en- acted in the country of shipment, the second paragraph of the General Paramount Clause is implicated and the Hague-Visby Rules are therefore incorporated into the Bill of Lading. In this case, the country of shipment was Japan, which had not enacted the Hague-Visby Rules at the time of the contract. Thus, the second paragraph of the General Paramount Clause is not implicated. Accord- ing to the first paragraph of the General Paramount Clause, the Hague Rules as enacted by Japan would be incorporated into the Bill of Lading. While the General Paramount Clause suggests the ap- plication of Japanese COGSA, we nonetheless agree with the district court’s conclusion that the liability limits of the Hague-Visby Rules, as enacted in England, apply to the Itel/Candyline agreement. First, Clause 3 in the Bill of Lading (forum selection clause) states that any dispute arising under the Bill of Lading shall be decided in the country of the carrier’s place of business. The “carrier” for purposes of the Itel/Candyline agreement is 10a Candyline, whose principal place of business is London. Thus, Clause 3 points toward the application of English law. Second, Clause 10 (“English law to apply”), which is contained in the typewritten addendum to the Booking Note, calls for the application of English law. Until recently, forum selection clauses such as these were unenforceable as a violation of U.S. COGSA. Re- cently, however, the Supreme Court overruled the line of cases invalidating forum selection clauses in COGSA cases, holding that U.S. COGSA does not nullify foreign arbitration clauses contained in maritime bills of lading. See Vimar Seguros y Reaseguros, S.A. v. M/V Sky Reefer, 515 U.S. 528, 535-36, 115 S.Ct. 2322, 2327-28, 132 L.Ed.2d 462 (1995). In Sky Reefer, the Court up- held a foreign arbitration clause against a challenge that the clause violated section 3(8)* of U.S. COGSA by making recovery under U.S. COGSA more difficult. See id. at 531-32, 115 S.Ct. at 2324-26. At least one court has upheld a foreign forum selection clause based on the Court’s analysis in Sky Reefer, noting that such clauses are enforceable unless the substantive law the foreign forum would apply is less than what COGSA guarantees. See Blaise G.A. Pasztory v. Croatia Line, 918 F.Supp. 961, 965 (E.D.Va.1996). Here, the foreign forum selection clauses call for the application of English law which, under the Hague-Visby Rules, contains a higher liability limit than that under U.S. COGSA. Thus, under a Sky Reefer-type analysis, the forum selection clause should be enforced. 4 Section 3(8) of U.S. COGSA provides: Any clause, covenant, or agreement in a contract of carriage relieving the carrier or the ship from liability for loss or damage to or in connecction with the goods, arising from negli- gence, fault, or failure in the duties or obligations provided in this section, or lessening such liability otherwise than as pro- vided in this chapter, shall be null and void and of no effect. 46 U.S.C.App. § 1803(8). | CEE ere re ney ae lla Furthermore, under generally accepted principles of contract construction, specific clauses take precedence cver general ones, and clauses that have been added by the parties preempt form provisions. See, e.g., Insurance Co. of N. Am. v. S/S SEALAND DEVELOPER, 1990 A.M.C, 2967, 2970 & n. 4 (S.D.N.Y.1989). Clause 10 of the addendum to the Booking Note is a specific clause that was added by the parties and therefore should pre- empt the boilerplate clause paramount. Additionally, while Clause 3 of the Bill of Lading was not added by the parties, it is more specific than the General Para- mount Clause, and it, too calls for the application of English law. As to Candyline’s argument that under English law, the liability scheme contained in the Japanese COGSA, rather than that of the English Hague-Visby Rules, would apply, we agree with the district court that the language of Clause 10 (“English law to apply”) together with that of Clause 3 (forum selection clause) satisfies Article X(c) of the Hague-Visby Rules, which provides that the Hague-Visby Rules apply if “the contract contained in or evidenced by the bill of lading provides that these Rules or legislation of any State giving effect to them are to govern the contract.” C. Do the Liability Limits of the U.S. COGSA Apply to the Candyline/Mammoet Agreement? We turn now to the question of whether the Candyline/ Mammoet agreement evidences a clear intent to abrogate the liability limits of the U.S. COGSA in favor of higher liability limits contained in a foreign statutory regime. As the district court noted, the Candyline/Mammoet con- tract and the Itel/Candyline contract are nearly identical. However, the district court concluded that unlike the Itel/Candyline agreement, the Candyline/Mammoet agreement did not evidence an intent to overcome the congressional mandate that the liability limits of the U.S. COGSA apply in the absence of a clear agreement to 12a apply a higher liability limit. We disagree. While the Candyline/Mammoet situation is marginally different from the Itel/Candyline situation, we do not think the differ- ences between the two situations constitute adequate grounds upon which to distinguish the statutory schemes applicable to the liability limits of the respective contracts. The factors that counseled in favor of our applying the higher liability limits of the English Hague-Visby Rules to the Itel/Candyline contract are present in the Candyline/ Mammoet contract, as well. As with the Itel/Candyline contract, the Bill of Lading was issued in Japan, and the country of shipment was Japan; both of these facts suggest, as they did in the Itel/Candyline contract, the application of the Japanese COGSA liability scheme, which does not include the Hague-Visby Rules. However, the Candyline/Mammoet agreement, like the Itel/Candyline agreement, also con- tains Clause 10, the typewritten term added by the parties stating “English law to apply.” Therefore, the only ground for distinguishing between the Itel/Candyline situation and the Candyline/Mammoet situation is Clause 3 (forum Selection clause), which provides for the application of the law of the carrier’s principal place of business. The “carrier” for the purposes of the Candyline/Mammoet agreement was Mammoet, whose principal place of busi- ness is Amsterdam rather than London. Thus, Clause 3 calls for the application of Dutch law. Clause 3, however, is an inadequate ground upon which to distinguish the Itel/Candyline contract from the Candyline/Mammoet contract, for two reasons. First, Clause 3 specifies that “{a]ny dispute . . . shall be decided in the country where the carrier has his principal place of business, and the laws of such country shall apply except as provided else- where herein.” (emphasis added). Clause 10, a type- written phrase added by the parties, specifically provided for the application of English law. Second, even if Clause 10 were eliminated, the Netherlands, like England, has adopted the Hague-Visby Rules. Thus, even if the lia- 13a bility limits of the contract were governed by Dutch law, the higher liability limits contained in the Hague-Visby Rules would nevertheless apply. See 6 Benedict on Ad- miralty 1-30 (Frank L. Wiswall ed., 1998). We there- for conclude that Clause 3 is not an appropriate ground upon which to distinguish the Itel/Candyline agreement from the Candyline/Mammoet agreement. If anything, Clause 3 evidences an intent to abrogate the liability limits of the U.S. COGSA in favor of a foreign statutory scheme with higher liability limits. IV. CONCLUSION For these reasons, we affirm the district court’s deter- mination that the amount of liability under the Itel/ Candyline contract is governed by the English Hague- Visby Rules and reverse the district court’s conclusion that amount of indemnity under the Candyline/Mammoet agreement is subject to the U.S. COGSA. We remand for the district court to determine the amount of indemnifica- tion to which Candyline is entitled pursuant to the English Hague-Visby Rules. AFFIRMED in part, REVERSED in part and RE- MANDED. l4a APPENDIX B [Filed May 1, 1998] UNITED STATES COURT OF APPEALS FOR THE ELEVENTH CIRCUIT No. 97-8278 District Court No. 4:94-CV-55 ITEL CONTAINER CORPORATION, Plaintiff-A ppellee, versus M/V “TITAN SCAN”, her engines, boilers, etc.; Moput Carriers A. G. & Co. “TITAN SCAN” SCHIFFAHRTS K. G.; MAMMOET SHIPPING, B.V., Defendants-Cross- claimants-A ppellees, SKY SHIPPING LTD. f.k.a. CANDYLINES LTD., Defendant-Cross- claimant-A ppellant. Appeal from the United States District Court for the Southern District of Georgia Before COX, DUBINA and BLACK, Circuit Judges. JUDGMENT This cause came to be heard on the transcript of the record from the United States District Court for the South- ern District of Georgia, and was argued by counsel; 15a UPON CONSIDERATION WHEREOF, it is now hereby ordered and adjudged by this Court that the judg- ment of the said District Court in this cause be and the same is hereby AFFIRMED in part and REVERSED in part; and that this cause be and the same is hereby RE- MANDED to said District Court with instructions in ac- cordance with the opinion of this Court; It is further ordered that defendants-cross-claimants- appellees, Mammoet Shipping pay to plaintiff-appellee, the costs on appeal to be taxed by the Clerk of this Court. Entered: May 1, 1998 For the Court: THOMAS K. KAHN Deputy Clerk By: /s/ Matt Davidson Deputy Clerk Issued as Mandate: Jun. 2, 1998 16a APPENDIX C [Filed Oct. 24, 1996] UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF GEORGIA SAVANNAH DIVISION Civ. No. 494-55 ITEL CONTAINER CORPORATION, a Plaintiff, M/V TITAN SCAN, her engines, boilers, etc., Moput CarRIERS A.G. & Co. “TITAN SCAN” SCHIFFAHRTS K.G., CANDYLINE LTp., MAMMOET SHIPPING B.V. and AUTORIDAD PORTUARIA NACIONAL,! Defendants. ORDER Following the 9/3/96 trial of this admiralty case, the Court now makes its findings of fact and conclusions of law. The complexity of the matter, however, warrants a brief summary of the Court’s determinations. In 1990, Plaintiff Itel Container Corporation (“TItel’”) purchased 198 refrigerated containers (“reefers”) and ar- ranged to have them transported from Japan to Savannah, Georgia. To this end, Itel contracted with Defendant Candyline Ltd. (“Candyline”), which in turn contracted with Defendant Mammoet Shipping B.V. (“Mammocet”) for actual carriage of the containers. Each agreement was evidenced by a bill of lading. Once it struck its deal with 1 Evidently never having been served by Itel, Autoridad Nacional ' Portuaria is now dropped from the action. F. R. Civ. P. 4(m). All future filings shall reflect a properly revised caption. 17a Itel, Candyline quickly executed a nearly identical agree- ment with Mommoet, using its contract with Itel as a model. Mammoet managed the vessel) TITAN SCAN, which was owned by Defendant Modul Carriers A.G. & Co. (“Modul”). The TITAN SCAN carried the reefers with- out incident to Balboa, Panama, at which time it made an unscheduled stop and restowed the cargo. As the vessel journeyed from Balboa to Savannah, twenty containers were lost overboard and six others severely damaged. As a result, Itel brought suit against Candyline, alleging inter alia, that Candyline was liable for Mammoet’s reckless conduct in restowing cargo without authorization. Itel also asserted claims directly against Mammoet, Modul, and the TITAN SCAN. These claims, however, are untimely and thus barred. Not only did Itel fail to bring its action within the one-year limitations period, but it made an insufficient showing that these Defendants con- sented to extend the time for suit. Nevertheless, because Candyline breached its contract of carriage, Itel can recover damages and prejudgment interest from Candyline. Those damages, however, are lim- ited by the Hague-Visby rules, which govern the Itel-Candy- line accord. Although Itel argued that the Hague-Visby limits are inapplicable in light of Mammoet’s alleged reck- lessness, the Court finds Mammoet at most acted negli- gently. Candyline, in turn, is entitled to partial indemnity from Mammoet for damages it pays to Itel. While Candyline argued that all liability should fully “pass through” to Mammoet, Candyline’s recovery is cabined by the lower liability limitations of the United States Carriage of Goods by Sea Act (“U.S. COGSA”). That statutory scheme ap- plies compulsorily “to all contracts for carriage of goods by sea to or from ports of the United States in foreign 18a trade.” Influenced by a variety of factors, the Court finds Mammoet did not assent to the application of a scheme (such as Hague-Visby) providing higher liability limits’ than those prescribed by U.S. COGSA. Finally, Mam- moet must reimburse Candyline for attorney’s fees and expenses incurred in defense of Itel’s action. I. Background Plaintiff Itel is a container leasing company. Stipulated Facts (“Facts”) € 1. In 1990, it bought 198 new refrig- erated containers in Japan for use in international com- merce at a cost of $23,883 apiece. Transcript (“Tr.”) at 8; Facts 41. Following the purchase, Itel arranged to have the containers shipped from Japan to the United States for distribution to its customers. Facts #41, 51. Seeking ocean transport, Itel’s employees in San Fran- cisco and London negotiated with Brown Jenkinson, Ltd., a London-based charterer representing Defendant Candyline in this transaction. Facts 442, 4, 5, 7-13. Candyline acted as a non-vessel operating common car- rier (“NVOCC”)—an entity that contracts with a shipper as carrier, but then enters into a separate agreement with a vessel owner or charterer for actual carriage of the ship- per’s cargo. Tr. at 28, 35, 43. Itel personnel negotiated the terms of the carriage con- tract with Candyline by telephone, telex and facsimile. The parties first evidenced their agreement with a Conline Booking Note containing boilerplate terms. Facts § 19, 20; 6/30/95 Order at 3, 15-16. Itel proposed various alterations to which Candyline agreed. Facts € 22. The parties thus struck preprinted Clauses 5 (in part), 6, 7, and 10 and replaced them with new provisions detailed in an addendum. Tr. at 54-66. Fearful that an American court or arbitrator would imply unintended terms to the 2 Each empty container had a size of 40’ x 9’6” x 8’. Together, all 198 reefers weighed 855,360 kilograms. 19a Itel-Candyline contract of carriage, at Candyline’s behest Clause 10 came to read, “English law to apply.” Tr. at 49-50; Facts ¢ 20. Significantly, the parties left untouched Clauses 2 (“General Paramount Clause”), 3 ( “Jurisdiction”), 9 (“Live Animals and Deck Cargo”), 19 (“Optional Stow- age”) and Additional Clause B. (“U.S. Trade, Period of Responsibility” )—provisions pertaining in some way to statutory schemes limiting a carrier’s liability to a shipper. Tr. at 66, 68-70; Facts 431. On 8/30/90, Itel and Candyline executed the final version of the booking note in London, with director Jonathan Marks signing on the latter’s behalf. Facts € 20; Tr. at 28. On 9/8/90, Candyline’s agent in Japan, A.A. Barwil Agencies K.K. (“Barwil’”). signed a bill of lading and delivered it thereafter to Itel’s agent in Japan. Facts 424. The bill of lading superseded and incorporated by refer- ence the Conline booking note: “Terms and Conditions as per Conline Booking Note Dated 30th August, 1990.” Facts 4 26. The document obligated Candyline to trans- port the containers from Yokohama, Japan to Savannah, Georgia. Pursuant to the freight provision, Itel paid $207,900 ($1,050 per unit) to Candyline about one week later. Facts 4435, 36. Itel neither declared an “excess value” for the containers nor paid additional freight for the shipment of such items. Facts € 34. As an NVOCC, Candyline negotiated with Defendant Mammoet to ship the containers. At the same time, Candyline also conducted discussions with Itel. Tr. at 52-53. Mammoet, an entity with its principal place of business in the Netherlands, managed the M/V TITAN SCAN, a vessel owned by Defendant Modul. Facts "¢ 16, 17. Mr. Marks, trying to “turn contracts in the market,” Tr. at 43, did not inform Mammocet of Itel’s identity, Tr. at 72, but he testified that Mammoet knew full well that Candyline did not own the containers to be transported. Tr. at 22, 41. 20a Mr. Marks’ “fundamental intent” regarding any agree- ment with Mammoet was its “back-to-back” or “pass through” nature. Tr. at 35-36, 205-06. As a fledging company. Candyline could ill-afford to strike any deal where Mammoet as carrier did not absorb all potential liability Candyline might incur on its contract with Itel; thus, Candyline aimed to guarantee that any liability would “pass through” Candyline to Mammoet. Tr. at 35, 39. To this end, Mr. Marks sought a Candyline- Mammoet contract to mirror the Candyline-Itel contract to the letter, so that the two would stand “back to back.” Tr. at 35, 52-53. In hammering out the agreement’s terms, Mr. Marks dealt extensively with Brian Carroll and Lindsay Adams, two agents in Mammoet’s London office. Tr. at 40, Mr. Marks insists Mr. Carroll understood and acceded to the “pass through” feature as the cornerstone of any agreement. Tr. at 45-46; cf. 151, 162. On 8/28/90, Mammoet made Candyline a “firm offer” of carriage. Tr. at 47, 151. Two days later, the parties executed in Lon- don a boilerplate Conline booking note prepared, in es- sence, by Candyline. Tr. at 64; Facts 44 37, 38. In order to ensure a “pass through,” Mr. Marks used the Itel-Candyline booking note as a model: he canceled the same preprinted terms Itel had previously stricken and appended “additional clauses” identical to those found in the Itel-Candyline addendum. Tr. at 64-66, 181-82. Clauses 2, 3, 9, 19 and Additional Clause B remained undisturbed, while Clause 10 again provided “English law to apply.” To Lindsay Adams, Mammoet’s agent in Lon- don, “[Clause 10] was a typical insertion” in “the UK markets.” Tr. at 64-66, 68, 174, 184-85; Facts 4 46. Only the rate of freight varied from the Candyline-Itel contract,® Tr. at 49, and Candvline neither declared an 3 Mammoet collected $950 per unit, so that Candyline made a $100 profit on each container shipped once it paid freight to Mammoet approximately two weeks later. Tr. at 49, 73; Facts §{ 33, 47. 2la “excess value” for the containers nor paid additional freight for their shipment. Facts qq 47, 48. More importantly, Candyline failed to include any declaration of its “pass through” intent in writing to Mammoet. Tr. 71, 189, 207, 209. At trial, Candyline suggested that the 1993 detonation of an IRA bomb at Candyline’s offices destroyed any documentation it had detailing the pertinent Candyline-Mammoet negotiations. Tr. 30, 207-08. Mr. Marks readily admitted, however, that Candyline never had discussions with Mammoet con- cerning a liability scheme; he believed any such action would be superfluous in light of the “back-to-back” nature of the contracts. Tr. 55, 73-74, 188-89, 198, 206.4 More- over, Mammoet could produce no records reflecting Mr. Marks’ intent. Tr. 71, 207, 209. On 9/8/90, Nedlloyd Lines Agencies K.K. (“Ned- lloyd”), as agents of Mammoet in Japan, signed the Can- dyline-Mammoet bill of lading and delivered the original to Barwil, Candyline’s agent. Facts 439. Candyline drafted the document at Mammoet’s request, and just like its Candyline-Itel counterpart, it provides “Terms and Conditions as per Conline Booking Note Dated 30th August, 1990.” Tr. at 66-67: Facts qq 39, 40. At the beginnig of September 1990, the TITAN SCAN loaded general cargo at Hatachi, Japan that was destined for discharge at Puerto Moin, Costa Rica. Tr. at 112-13, 140. A few days later, Itel’s containers, then in good con- dition, were loaded in Yokohama onto the ship’s eight on- deck bays and into holds below. Tr. at 115, 121; Facts 451. Itel asserted at trial that port regulations in Yoko- hama limited the stacking of reefers to four in height,5 * Nevertheless, Mr. Marks still secured insurance to cover the voyage of Itel’s containers across the Pacific and beyond. Tr. 71. 5 However, as aptly noted by counsel for Mammoet and Modul, Tr. at 219, Itel made no proffer of evidence to elucidate the sub- stance of these port restrictions beyond merely referencing them, 22a Tr. at 114, 129, 139, 195-96, and further submitted the vessel’s Container Stowage Plan as proof that cargo this size could not be stacked any higher than four.® In ac- cordance with these specifications, the containers stood in tiers of three, two, four, four, four, four, three, and three in each of the eight bays when the TITAN SCAN de- parted Yokohama on 9/9/90. Tr. at 117. The voyage en route to Puerto Moin and Savannah was uneventful until the TITAN SCAN unexpectedly stopped in Balboa, Panama; the vessel’s chief officer, Reinhard Juttner, called on that port in compliance with orders received from Mammoet. Tr. at 121, 142; Facts 454. Under the guidance and supervision of the ship’s personnel, stevedores there restowed the Itel cargo located in bays one and two in order to create sufficient space to allow for the discharge in Puerto Moin of other cargo stowed below deck. Tr. at 86-87, 121, 141. After the reconfiguration, the first two bays held no containers, whereas the fourth, fifth and eighth bays now stacked Itel’s cargo in tiers of five. Tr. at 79, 86-89, 124-25; Facts 4 54. Although Mr. Juttner testified that no restrictions pre- vented the restowing of containers five high, Tr. at 126, Pl’s Exh. 4; Tr. at 142, 195-96, and any judicial notice by this Court of Japanese law would be inappropriate. International Trad- ing Co. v. M/V ZENIT SUN, 684 F. Supp. 861, 864 (E.D.Pa. 1988) (“No proof having been presented at trial as to Chilean law, the court cannot take judicial notice of the law of Chile”). In any event, Itel failed to prove how Yokohama port regulations govern a carrier’s conduct once the vessel is in the Caribbean. 6 Itel’s own witness, a marine surveyor with the Maritime Bureau named John Peck, conceded on cross-examination that the Con- tainer Stowage Plan is merely a guideline for the transport of loaded containers. Here, by contrast, Itel’s containers were empty. Tr. at 92-93; 114, 137-38. As a consequence, Itel’s contention that violation of the Plan constituted reckless conduct on the part of Mammoet and the crew of the TITAN SCAN is accorded little weight. See infra at 9-10, 26-28. 23a 129, Mr. Marks swore under oath that (1) Mammoet failed to inform Candyline either before or during the transport that restowing would be necessary or that the TITAN SCAN would anchor in Balboa, Tr. at 22, 76; (ii) he expected Itel’s cargo would “not be touched” once loaded in Japan, Tr. at 22; (iii) industry practice forbids the restowing of cargo without permission, Tr. at 23; and (iv) had Mammoet sought permission, Candyline would likely have asked Itel “out of prudence,” and recom- mended “no objection” on the condition that a Candyline- appointed surveyor supervise the stevedores. Tr. at 23-24. The vessel proceeded and discharged its cargo without incident in Puerto Moin, but while in transit to Savannah, twenty containers from bay five were lost overboard and six others damaged in the early morning hours of 10/ 11/90. Tr. at 11-12, 88, 230; Facts €55. Itel charged that the containers were inadequately secured as a result of restowing in Balboa: rather than unitizing the first and second tiers of containers with twistlocks, as the Container Stowage Plan provides, the stevedores and TITAN SCAN personnel utilized double stacking cones, a device which cannot bind one container to another as tightly as the twistlocks. Tr. at 79-80, 89-90, Furthermore, Itel argued that (i) the TITAN SCAN’s structural design hindered proper fastening of the containers, since the bays them- selves afforded inadequate room for the use of criss- cross lashing, instead of the less effective vertical lashing that was used, Tr. at 82-85, 103-04, 134; and (ii) stack- ing reefers five high, above the ship’s center of gravity and in contravention of Yokohama’s port regulations, created a situation that significantly increased the possibility of container loss or damage. Taken together, Itel contended that numerous deviations from proper containerization constituted recklessness and not simply negligence on the part of Candyline and Mammoet. Tr. 211-215. Mammoet did not dispute the harm that befell Itel’s cargo on the way from Puerto Moin to Savannah, Facts 24a ¢ 55, but responded by noting that the unitization and lashing in the other bays remained intact and the rest of the cargo—nearly ninety percent—arrived in good condi- tion in Savannah on October 13, 1990. Tr. at 131. John Peck, presented by Itel as an expert in maritime contain- erization, concurred with Mammoet’s assessment that the twenty containers went overboard when the adjustable bridge fittings, ordinarily used to secure columns of con- tainers to one another, Tr. at 90, 120, opened for reasons unknown. Tr. at 104. This destabilized the stow so dras- tically that something as minor as the vessel’s normal vi- brations could then have caused the cargo to jolt, hasten- ing the loss of the reefers. Tr. at 94-95. At trial, Itel claimed damages of $477,660 for the twenty lost containers, $54,253.75 for the six damaged reefers, and $97,797.04 for costs incurred in locating and removing containers from the waters of the Caribbean,’ for a total of $623,710.79. Although Itel sued Candyline claiming breach of the contract of carriage, Candyline, in turn, attempted to deflect liability onto Mammoet, alleg- ing that because Mammoet assented to “back-to-back” con- tracts, Candyline was entitled to full indemnification for any payments made to Itel. In addition, Itel sued the TITAN SCAN in rem and Mammoet and Modul in tort, alleging a bailment theory. Il. Governing Standards A. Breach and Indemnity Because courts have not hesitated to hold NVOCCs liable for cargo loss or damage, Candyline stands liable to Itel if the contract of carriage is found to be breached. See, e.g., Antilles Ins. Co. v. Transconex, Inc., 862 F.2d 391-92 (1st Cir. 1988) (holding NVOCC liable for cargo 7 An Itel employee, Lisa Leach, testified about only $60,997.04 of these expenses, but Defendants did not dispute the paperwork Itel offered into evidence detailing $91,797.04 worth of damages. 25a damage); Polyplastics, Inc. v. Transconex, Inc., 827 F.2d 859, 860 (1st Cir. 1987) (“Vis-a-vis the owner, the [NVOCC] retains primary responsibility for carriage of the goods from origin to destination.”); 6/30/95 Order at 11. Nonetheless, this Court has already held that Candyline is entitled to indemnity from Mammocet for claims recover- able against Candyline by Itel. 2/15/96 Order at 4; In- surance Co. of N. America v. M/V OCEAN LYNX, 901 F.2d 934, 941 (11th Cir. 1990), cert. denied, 498 U.S. 1025 (1991). B. Time Bar Issues Itel’s independent claims against Mammoet, Modul, and the TITAN SCAN encounter insurmountable obstacles. Ordinarily, Itel could sue Mammoet in contract for dam- age and loss to cargo, because “where an agent [Candy- line] contracts with a third party [Mammoet] on behalf of a partially disclosed principal [Itel], the third party is liable to such principal as if the parties had contracted directly.” Orion Ins. Co. v. M/V HUMACAO, 1994 A.M.C. 1922, 1924 n.5, 851 F. Supp. 575 (S.D.N.Y. 1994): 6/30/95 Order at 11-12. Moreover, by its very terms the Candy- line-Mammoet bill of lading binds the carrier and the “Merchant,” which is defined broadly in the bill to include “the Owner of the cargo.” 6/30/95 Order at 11. See also All Pacific Trading, Inc. v. M/V HANJIN YOSU, 7 F.3d 1427, 1432 (9th Cir. 1993), cert. denied sub nom. Hanjin Container Lines, Inc. v. Tokio Fire & Marine Ins. Co., Ltd., 114 S.Ct. 1301 (1994) (finding privity of contract between shipper and actual carrier based on broad defi- nition of “Merchant” in bill of lading, despite presence of NVOCC). At earlier stages in these proceedings, however, Mam- moet and Modul asserted a statute of limitations defense against Itel. At that time, all parties agreed that, under any of the possible statutory regimes limiting a carrier’s liability—U.S. COGSA, Japan’s International Carriage of 26a Goods by Sea Act (“Japanese COGSA”), or the British Carriage of Goods by Sea Act (“Hague-Visby”)—the ap- plicable limitations period is one year. U.S. COGSA— which, as will be seen, governs Mammoet’s obligations— discharges the carrier and the ship “from all liability in respect of loss or damage unless suit is brought within one year after delivery of the goods or date when the goods should have been delivered[.]” 46 U.S.C. § 1303(6). When this strictly enforced statute of limitations accrues, Unilever Ltd. v. M/T STOLT BOEL, 77 F.R.D. 384, 386 (S.D.N.Y. 1977), the time-bar effectively extinguishes not just the remedy, but the cause of action itself. American Hoesch, Inc. v. Steamship Aubade, 316 F. Supp. 1193, 1194 (D.S.C. 1970); 129 ALR Fed 273, 289 (1996). While U.S. COGSA typically limits liability arising from contract, § 1303(6)’s plain language does not preclude its application to claims sounding in tort. Commercial Sheet- metal Co., Inc. v. Matson Navigation Co., 711 P.2d 738, 740 (Haw. Ct. App. 1986) (“COGSA § 1303(6)’s suit deadline applies to ‘all liability.” That phrase encompasses both contract and tort liability.”); Barretto Peat, Inc. v. Luis Ayala Sucrs., Inc., 896 F.2d 656, 661 (ist Cir. 1990) COGSA’s one-year statute of limitations applies to torts); Reisman v. Medafrica lines, U.S.A., 592 F. Supp. 50, 52 (S.D.N.Y. 1984) (COGSA’s statute of limitations bars shipper’s claims for breach of contract and negli- gence) .® It is undisputed that Itel filed its Complaint on 12/26/91, one year and two months after the TITAN 8 See also St. Paul Fire and Marine Ins. Co. v. Marine Transpor- tation Svcs. Sea-Barge Grp., 727 F. Supp. 1488, 1442 (S.D.Fla. 1989) (“COGSA provides an exclusive remedy, barring all other theories of liability, including theories of bailment and negli- gence”); Miller Export Corp. v. Hellenic Lines, Ltd., 534 F. Supp. 707, 710-11 (S.D.N.Y. 1982) (“exclusive application of COGSA can- not be avoided by couching claims in terms of negligence or other common law causes of actions .. .”’). 27a SCAN discharged Itel’s reefers in Savannah. 6/30/95 Order at 6; Facts 4.57. At first blush, Itel failed to meet U.S. COGSA’s limitations period; in fact, Candyline granted a six-month extension of time in which to sue. 6/30/95 Order at 7. The right to invoke the U.S. COGSA limitation period may be waived— indeed, such extensions are common in the industry—but the terms of a ‘waiver are strictly construed. Bunge Edible Oil Corp. v. M/V TORM RASK, 756 F. Supp. 261 (E.D.La. 1991), aff'd, 949 F.2d 786 (Sth Cir.), cert. denied, 505 U.S. 1207 (1992); United Fruit Co. v. J.A. Folger & Co., 270 F.2d 666, 668-669 (Sth Cir. 1959), cert. denied, 362 U.S. 911 (1960) ; 6/30/95 Order at 5-6, 8. Prior to trial, Mammoet and Modul argued that Candy- line’s consent did not extend to Itel. 6/30/95 Order at 8. As a consequence, they contended that the Statute of limi- tations precluded Itel from asserting its direct claims against them. This Court, despite noting that “[t]he most plausible reading of the correspondence shows that Candy- line consulted the vessel owners and management, secured their consent to an extension, and then relayed this in- formation to Itel on behalf of all concerned,” nevertheless found the statute of limitations question to be a genuine issue of material fact, since later communications gave “the distinct impression that Candyline and [Mammoet and Modul] viewed the extension as a grant to Candyline alone.” 6/30/95 Order at 8-9. Thus, after two rounds of motions for summary judgment, the issue of whether Itel’s claims against Mammoet and Modul were time- barred was preserved for trial. At trial Candyline, evidently secure in the fact that Mammoet would indemnify it for any liability incurred with respect to Itel, made no effort to prove that the six- month extension applied to the vessel owner and manager. More puzzling, however, is why Itel neglected any dis- cussion of the subject. In closing argument, Mammoet and 28a Modul presented no evidence but formally moved to bar, on statute of limitations grounds, any claim Itel had against Mammoet and Modul through the Candyline- Mammoct bill of lading. Tr. at 215-16. Hence, by the close of trial, the parties scarcely resolved an issue ex- plicitly left open for resolution in oral argument. Now confronting the issue squarely, the Court finds Itel has not carried its burden of proving that the vessel’s own- ers and manager granted an extension allowing for direct suit. Not only has Itel already admitted that Modul and Mammoet did not directly grant it an extension of time, 6/30/95 Order at 7, but, as previously discussed, waivers of the statute of limitations are strictly construed, no mat- ter what their prevalence in the maritime community. See A.B. Volvo v. M/V ATLANTIC SAGA, 534 F. Supp. 647, 648-49 (S.D.N.Y. 1982) (extensions granted by ves- sel’s agent do not bind vessel when latter refused to give extension on its own behalf). Furthermore, Clause 17— an item in full force in both the Itel-Candyline and Candy- line-Mammoet bills of lading—limits Itel’s recovery to contract-based remedies alone and entitles a bailee to take advantage of liability liimts provided by law (here, U.S. COGSA). Thus, Itel’s direct claims against the vessel,® its OWner, and its manager—including those in tort—are time-barred, and Itel’s only basis for recovery stems from its agreement with Candyline. C. Statutory Regimes Limiting Liability In ascertaining the extent to which Candyline and (by extension) Mammoet are liabel to Itel, this Court has already ruled that the Itel-Candyline agreement is governed by the Hague-Visby Rules, a statutory regime adopted in ® Nothing precludes the time bar from operating on in rem ac- tions against the vessel. See Bunge Edible Oil, 949 F.2d at 787 (affirming dismissal of in rem claims against vessels as untimely) ; Mitsubishi Corp. v. M.V. Oinoussian Strength, 1994 WL 74087 at *4 (S.D.N.Y. 3/8/94) (same). 29% England that limits a carrier’s liability. 6/30/95 Order at 15-16; 2/15/96 Order at 5-6. Those Rules state: Unless the nature and value of such goods have been declared by the shipper before shipment and inserted in the bill of lading, neither the carrier nor the ship shall in any event be or become liable for any loss or damage to or in connection with the goods in an amount exceeding the equivalent of 10,000 francs per package or unit or 30 francs per kilo of gross weight of the goods lost or damaged, whichever is higher. Article IV, British Carriage of Goods by Sea Act of 1971. See also J.C.B. Sales, Ltd. v. M/V SEIJIN, 1996 A.M.C. 1507, 1510, 921 F. Supp. 1168 (S.D.N.Y. 1996); Pyro- power Corp. v. M/V ALPS MARU et al., 1993 A.M.C. 1562, 1567-1568, 1993 WL 45978 (E.D.Pa. 1993). This Court, however, reserved judgment as to which liability scheme—Hague-Visby, Japanese COGSA, or U.S. COGSA —applies to the Candyline-Mammoet bill of lading.1° Had § 1303(6) not barred Itel’s independent claims against Mammoet, Modul and the TITAN SCAN, this determina- tion would have been crucial, for it would have controlled Mammoet and Modul’s direct liability to Itel. As it stands, the choice of liability scheme still dictates the extent of Mammoet’s indemnity to Candyline, since, as discussed infra at 17, Candyline stands liable to Itel for breach of the contract of carriage. U.S. COGSA applies compulsorily “to all contracts for carriage of goods by set to or from ports of the United States in foreign trade.” 46 U.S.C. § 1312. “[R Jegardless of any provision to contrary in the bill of lading or any rule to the contrary under foreign law .. . the parties do not have the freedom to displace COGSA with another 10 At the time Mammoet shipped Itel’s containers, neither Japan nor the United States had adopted the Hague-Visby Rules. Facts at 11. 30a regime.” 2A Benedict on Admiralty § 46 at 5-13. US. COGSA reads similar to the Hague-Visby Rules and pro- vides: Neither the carrier nor the ship shall in any event be or become liable for any loss or damage to or in con- nection with the transportation of goods in an amount exceeding $500 per package . . . unless the nature and value of such goods have been declared by the shipper before shipment and inserted in the bill of lading. 46 U.S.C. § 1304(5). Notwithstanding this limitation, U.S. COGSA permits shippers and carriers to agree by contract to raise their liability to an amount exceeding $500 per package. 7/d. If the parties agree to a higher liability limit, then—but only then—may a foreign legal regime trump USS. COGSA. See, e.g., Ilva U.S.A., Inc. v. M/V BOTIC, et. al., 1993 A.M.C. 240, 243-44, 1992 WL 296562 (E.D. Pa. 1992) (finding mutual intent to raise $500 limitation of U.S. COGSA where goods carried from Italy to Phila- delphia). If, however, the question of whether the parties agreed to a higher limit is “irretrievably ambiguous,” then U.S. COGSA limit applies by default, for there is no clear intent otherwise. 6/30/95 Order at 14; see Valmet Ma- terials Handling Equipment, Inc. v. Nedlloyd Linjen B.V. Rotterdam, 1993 A.M.C. 1243, 1246, 1993 WL 204149 (M.D.Fla. 1993). Ill. Analysis Candyline unquestionably breached its contract of car- riage with Itel when twenty reefers were tossed overboard and six others suffered extensive damage during the voy- age from Japan to Savannah. Tr. 40. After all, in strik- ing an agreement with Candyline, Itel sought to ensure safe passage of its cargo from Japan to Savannah. How- ever, Itel’s recovery is constrained because, as mentioned 3la earlier, its direct claims against Mammoet and Modul are time-barred and, as explained below, the Hague-Visby statutory regime limits the extent of Candyline’s liability. B. Liability Limitations and The Extent of Indemnity This Court previously concluded as a matter of law that the Hague-Visby statutory scheme governs the Itel- Candyline accord. 6/30/95 Order at 1416; 2/15/96 Order at 5-6. In making this determination, it evaluated numerous factors, see Z.K. Marine, Inc. v. M/V ARCHI- GETIS, 1993 A.M.C. 1444, 808 F. Supp. 1561 (S.D. Fla. 1992), and found that: (i) the bill of lading was issued in Japan, 2/15/96 Order at 6; (ii) Candyline, the “carrier” for purposes of the transaction, had its principal place of business in England, and Clause 3 of the bill of lading provides that the law of the country in which the carrier has its principal place of business applies to any dispute; (iii) previous courts had construed the same Gen- eral Clause Paramount (the bill of lading’s Clause 2) as evidencing an intent to agree to a higher liability limita- tion than that provided by U.S. COGSA; and (iv) Clause 10 (“English law to apply”), a provision to which the parties mutually agreed, incorporated a foreign legal regime (i.e., Hague-Visby) with a liability limit exceeding $500 per package. 6/30/95 Order at 14-16; Pyropower Corp., 1993 A.M.C. at 1570-71; Ilva, 1993 A.M.C. at 242-43 44 11In directing its attention towards factors (i) and (iv), the Court’s analysis was guided by Article X of the British Carriage of Goods by Sea Act of 1971, which states that [t]he provisions of these Rules [Hague-Visby] shall apply to every bill of lading relating to the carriage of goods between ports in two different States if: (a) the bill of lading is issued in a contracting State, or (b) the carriage is from a port in a contracting State, or (c) the contract contained in or evidenced by the bill of 32a In contrast, the Court could not ascertain on summary judgment whether Candyline and Mammoet agreed to a higher limitation than U.S. COGSA’s to operate on their own bill of lading. 6/30/95 Order at 17-19. Conse- quently, the Court received evidence concerning this issue at trial. While the provisions of the Candyline-Mammoet contract are often identical to its Itel-Candyline counter- part—and although Candyline repeatedly has trumpeted the “pass through” aspect to its dealings—the contracts must be evaluated as distinct agreements, since the “proper method of defining relationships between shippers, NVOCCs, and vessel owners is to treat the various bills of lading as just that—discrete shipping agreements know- ingly entered by the parties involved.” 6/30/95 Order at 20 (citing Gross Machinery Group v.M/V ALLIGATOR INDEPENDENCE, 1994 A.M.C. 732, 737-739, 1992 WL 47557 (S.D.N.Y. 1992)). Trying to absolve itself of liability entirely, Candyline argued that mirror agreements must be controlled by the same statutory regime. Because Hague-Visby’s liability limits are higher than those established by U.S. or Japa- nese COGSA, Candyline sought to prove that Hague-Visby governs the Candyline-Mammoet agreement, lest Candy- line not receive full indemnity from Mammoet for any sums paid to Itel as damages.* To this end, Mr. Marks — lading provides that these Rules or legislation of any State giving effect to them are to govern the contract. That the Itel-Candyline bill of lading was issued in Japan (factor (i)) did not lead the Court to conclude that Article X(a) was satisfied, since Japan was not a “contracting state” in 1990. Supra note 10. The presence of typewritten Clause 10 (factor (iv)), how- ever, combined with factors (ii) and (iii), evidenced that the Hague-Visby Rules governed the contract, thus satisfying Article X(c). 12 At bottom, Candyline’s primary concern is “parallelism.” Tr. at 224-226. Because it aims to effectuate a complete “pass through” of liability, it insists that the same statutory regime should control both contracts. While Candyline argued at trial that the Hague- q : ’ ; 33a testified that in knowingly accepting a contract that stood “back-to-back” to the Itel-Candyline accord, Mammoet explicitly acceded to the application Hague-Visby. Mr. Marks steadfastly adhered to this assertion despite con- ceding that the parties never actually spoke about liability schemes per se. In light of the evidence adduced at trial, as well as Candyline’s post-trial concessions, see supra note 12, the Court finds that U.S. COGSA governs the Candyline- Mammocet contract. As with the Candyline-Itel agreement, Candyline and Mammoet reached the terms of the book- ing note in London, but signed the bill of lading, which incorporated the terms of the booking note in toto, in Japan. Again Clause 3 was left intact, but this time the carrier’s principal place of business is Mamunoet’s office in Amsterdam, not London. Thus, unlike its analysis of the Itel-Candyline accord, which led to the inexorable conclusicn that Hague-Visby controlled, these factors do not point the Court in a definite direction. Muddying the waters further are Clauses 2 and 10. The parties did not strike Clause 2, which provides that the bill of lading incorporates the Hague Rules as enacted in the country of shipment (here, Japan) and has been read by other courts as an agreement to a liability limita- tion greater than that provided by U.S. COGSA. See, e.g., Ilva, 1993 A.M.C. at 242-43; Associated Metals & Mineral Corp. v. M/V ARKTIS SKY, 1991 AMC. 1499, 1505-06, 1991 WL 51087 (S.D.N.Y. 1991), va- cated and remanded on other grounds, 978 F.2d 47 (2d Cir. 1992). Mr. Marks, however, also introduced Clause 10 (“English law to apply”) into both agreements to which Candyline was party, and a “typical insertion” ought not be read in a manner rendering it superfluous. Still, he admitted he did not intend to address liability Visby rules apply to the Candyline-Mammoet contract, it has since reversed course. In its post-trial submissions, it contends that its contract with Mammoet is governed by Japanese COGSA. 34a schemes in inserting the provision, and he could not produce a shred of documentation evincing Mammoet’s express agreement to a higher liability limit. Leaving aside the uncontroverted destruction of Candyline’s files, Mammoet has no tangible record of Candyline’s “back-to- back” intent, and assuredly, an understanding of such material import would have been reduced to writing. Even if, during negotiations, Mr. Marks communicated his hopes far a “pass through” agreement to Mr. Carroll, the final versions of the booking note and bill of lading are devoid of any language to this effect. As a result, the parol evidence rule bars introduction of this evidence. See Warren v. Ajax Navigation Corp. of Monrovia, 1995 A.M.C. 2609, 1995 WL 688421 at *1 (S.D.Fla. 2/3/95) (“When a contractual agreement has been reduced to an integrated writing, the parol evidence rule dictates that evidence, whether parol or otherwise, of antecedent under- standing and negotiation will not be admitted for the purpose of varying or contradicting the writing.”); see also Anyangwe v. Nedlloyd Lines, 1996 A.M.C. 1083, 909 F. Supp. 315, 322 (D.Md. 1995) (assuming that prior oral understanding existed, but nonetheless barring evidence on parol evidence grounds). Whatever Candy- line’s expectations—articulated or implied—Mammoet is not held to a metaphysical standard of comprehension. This conclusion is strengthened by the fact that Mam- moet had no hand in bringing Clause 10 into the Candy- line-Mammoet bill of lading. See Associated Metals, 1991 A.M.C, at 1507 (ambiguities in bill of lading are con- strued against the drafter); Tano Automation, Inc. v. U.S., — F. Supp. —, —, 1996 WL 537744 at *3 (E.D. La. 9/20/96) (same). In its closing argument, Candyline urged the Court not to exalt boilerplate terms over a specially-added provision like Clause 10. Tr. at 226. While mindful that custom- ized provisions preempt preprinted ones, see Insurance Co. of N. Amer. v. S/S SEALAND DEVELOPER, 1990 eee ee? a 35a A.M.C. 2967, 2970 & n.4, 1989 WL 85789 (S.D.N.Y. 1989), Clause 10 alone is not dispositive as to whether Mammoet agreed to a higher liability limit than that provided by U.S. COGSA. The Court is reluctant to give a cryptic snippet (“Engish law to apply” to what?) such effect that it constitutes the sole measure of Mammoet’s express agreement to displace U.S. COGSA; indeed, an English solicitor retained by Candyline itself has sworn, “[ T]he fact that the terms of the contract of carriage pro- vided for English law to apply will not result in the incor- oration of the Hague-Visby rules.” Wisdom Aff. 44 17, 20. In striking its deal with Mammoet, Candyline was under no obligation to utilize the same standard forms it used with Itel. Instead, Candyline could have achieved its “pass through” objective by doing what others do on a regular basis, i.e., spell out its intent in a customized contract. Faced with tht ambiguity of preprinted Clause 2, which points in the direction of Japanese COGSA; boilerplate Clause 3, which calls for the application of Dutch law; and typewritten Clause 10, which applies English law but, according to accepted rules of contractual construction, must be construed against Candyline, the Court returns to its initial point of departure: U.S. COGSA applies ex proprio vigore “to all contracts of carriage of goods by sea to or from ports of the United States.” 46 U.S.C. § 1312; R.B.K. Argentina S.A. v. M/V DR. JUAN B. ALBERDI, 935 F. Supp. 358, 366 (S.D.N.Y. 1996). Although parties to a contract can agree to deviate upwards from U.S. COGSA’s package limitation, 46 U.S.C. § 1304(5), Candyline failed at trial to meet its burden of proving Mammoet’s unqualified assent to a limit above the $500 ceiling. Previously, the Court noted that “the evidence of conscious agreement by Mammoet 13 Indeed, “Additional Clause B” of the Candyline-Mammoet bill of lading explicitly contemplates the possibility that U.S. COGSA will govern. 36a and Modul is fairly thin,” and also remarked that “[t]here is no direct evidence that the defendants consciously agreed to increase their liability for any cargo damage{.]” 6/30/95 Order at 18-19. Having received and reviewed the weight of the evidence, nothing has altered the Court’s earlier inclinations.* Thus, Candyline—the “shipper” for purposes of its transaction with Mammoet-—is saddled with the $500 per package limitation, having never declared the value of the goods Mammoet transported. See 46 U.S.C. § 1304(5); Rockwell Int'l Corp. v. S/S KOELN EXPRESS, 1987 A.M.C. 2537, 2539, 1987 WL 33397 (D.Md. 1987). Having drafted the bill of lading, Candy- line unquestionably had a “fair opportunity” to make such a declaration. Hoechst Celanese Corp. v. M/V TRIDENT AMBER, 1992 A.M.C. 2769, 2774-75, 1992 WL 179219 (S.D.Ga. 1992); Unimac Co., Inc. v. C.F. Ocean Service, 43 F.3d 1434, 1438 (11th Cir. 1995. In sum, Candyline breached its contract of carriage with Itel, but its liability to Itel is capped by the application of the Hague-Visby Rules. Mammoet, in turn, must indem- nify Candyline for damages Candyline pays to Itel, but that reimbursement is restricted by the application of U.S. COGSA. See SPM Corp. v. M/V MING MOON, 22 F.3d 523, 525 & n. 3, 4 (3d Cir. 1994) (where an NVOCC has signed separate bills of lading with the shipper and carrier, each contract may specify different liability limits). C. Breaking the Limits In an effort to avert statutory liability limitations, at trial Itel sought to prove that re-stacking the containers 14In short, the Court finds that given the circumstances sur- rounding the formation of the Candyline-Mammoet agreement, Article X(c) of the British COGSA of 1971 is not satisfied in this instance. See supra note 11. 15 Each reefer constitutes a “package” for U.S. COGSA purposes. See Hayes-Leger Assocs., Inc. v. M/V ORIENTAL KNIGHT, 765 F.2d 1076, 1082 (11th Cir. 1985) (adopting Second Circuit’s defini- tion of “package”); Pyropower Corp., 1993 A.M.C. at 1572-73. 37a five high in Balboa was a reckless act by Candyline and Mammoet, in contravention of both the Yokohama port regulations and the Container Stowage Plan. As further evidence, Itel submitted that the use of vertical lashings and double stacking cones in securing the reefers departed so substantially from the accepted practice of criss-cross lashings and twistlocks as to constitute reckless behavior by the defendants. Finally, Itel maintained that the TITAN SCAN’s call and restowing at Balboa amounted to an impermissible deviation sufficient to oust the statu- tory regime limiting liability. Itel’s agreement with “carrier” Candyline is governed by the Hague-Visby regime, which prohibits the package lim- itation from applying in cases of recklessness: Neither the carrier nor the ship shall be entitled to the benefit of the limitation of liability . . . if it is proved that the damage resulted from an act or omis- sion of the carrier done with intent to cause damage, or recklessly and with knowledge that the damage would result. Article IV(5)(e); In Re Tecomar, S.A., 199] A.M.C. 2432, 765 F. Supp. 1150, 1182 (S.D.N.Y. 1991). De- spite having known since the middle of 1995 that the Hague-Visby rules apply to its contract with Candyline, Itel has provided the Court with the text of exactly one case addressing the issue of reckless conduct. In The Pembroke, 2 Lloyd’s Rpts. 291 (1993), the judge noted that the issue of recklessness “is a matter of fact for each case.” Id. at 296. That said, the Court finds Mam- moet’s conduct—for which Candyline is liable to Itel— negligent at worst.2¢ Having already rejected Itel’s arguments regarding the Yokohama port regulations and the Container Stowage 16 At trial, Mammoet all but conceded it actéd negligently. Tr. at 223-24 (“90 percent of the containers got there safely. That can’t be reckless; [it] may be negligence.’’). 38a Pian, see supra notes 5 and 6, the Court now concludes that in using vertical lashings and double stacking cones, Defendants did not take “a calculated risk with the full appreciation of the dangers and probable consequences.” The Pembroke, 2 Lloyd’s Rpts. at 297.17 Indeed, an ex- pert in marine containerization surmised that an inex- plicable failure in the bridge fittings proximately caused the loss of stow. Tr. at 94-95, 104; Streeton Dep. at 54- 58. For this reason, it cannot be said that Mammoet or the crew of the TITAN SCAN “knew of the probable result”—that is, that the cargo would be thrown over- board—when the reefers were restowed five high by stevedores in Balboa. The Pembroke, 2 Lioyd’s Rpts. at 296. As it stands, nearly ninety percent of the cargo ar- rived in Savannah in good condition. Thus, Itel cannot break the Hague-Visby limitations on the grounds that Defendants acted recklessly. Nor can Itel evade Hague-Visby for reasons relating to unreasonable geographic deviation or restowage (“quasi-deviation”). With Itel failing to introduce ade- quate English law on this score, the Court resorts to the application of U.S. admiralty law principles. Cavic v. Grand Bahama Development Co. Ltd., 701 F.2d 879, 882 (lith Cir. 1983) (citing Restatement (Second) of Conflicts § 136, coment h, at 378-79 (1971)); Cantieri Navali Riuniti v. M/V SKYPTRON, 8062 F.2d 160, 163 n. 5 (Sth Cir. 1986) (“In the absence of sufficient proof 17 Cf. Konica Business Machines v. Vessel SEA-LAND CON- SUMER, 1996 A.M.C. 1761, 1762-63, 1996 WL 468770 (C.D.Cal. 1996) (finding negligence, “but not more,” where cargo was jet- tisoned after crew failed to secure twistlocks; such action did “not rise to the level of an unreasonable deviation” sufficient to deprive vessel of U.S. COGSA’s liability limitations) ; Tecomar, 765 F. Supp. at 1184-1185 & n. 938, 94 (expressing reluctance to oust statutory liability limitations, for whether conduct is characterized as “will- ful,” “wanton” or “reckless,” courts ought not evaluate “in almost every case the degree of the carrier’s culpability”) (citations omitted). | 39a to establish with reasonable certainty the substance of the foreign principles of law, the modern view is that the law of the forum should be applied.”) (cites and quotes omitted). The doctrine of deviation provides “that when a car- rier deviates markedly from the contract of Carriage, [U.S.] COGSA does not apply because the bill of lading, which acts as the contract of carriage, is nullified.” Uni- mac, 43 F.3d at 1437. See also Yang Machine Tool Co. v. Sea-Land Service, Inc., 58 F.3d 1350, 1358 (9th Cir. 1995) (defining deviation as “a serious departure from the contract of carriage, exposing the cargo to unantici- pated and additional risks.”) (cites and quotes omitted). Courts have applied the doctrine “sparingly,” reserving it for instances of unreasonable geographic departures and unauthorized on-deck stowing. Unimac, 43 F.2d at 1437. While conceding that mere re-stacking at a sched- uled port does not warrant the ouster of US. COGSA, see Anyangwe, 909 F. Supp. at 321 (indeed, even “Tijn- tentional restowage at an [unscheduled] intermediate port is neither a deviation nor a quasi-deviation”), Itel never- theless insists that application of the deviation doctrine is appropriate here. The Court disagrees. For starters, Clause 5 of the Itel-Candyline and Candyline-Mammoet bills of lading States that the vessel, “engaged in liner service,” “is not limited to the direct route” of travel. Where the bill of lading provides such notice to the shipper, it precludes a finding of deviation. See Yang Machine, 58 F.3d at 1352 (no deviation where bill of lading gave carrier the right to substitute vessels without informing shipper); Great Amer. Ins. Cos. v. M/V ROMERAL, 934 F. Supp. 744, 747 (E.D.La. 1996) ( “stops at a vessel’s customary ports of call, whether or not the bills of lading list those ports, 18 While the parties struck the remainder of Clause 5, there is no indication that this portion was unintentionally left intact. Tr. at 65, 182, 218-19; Cook Dep. at 17-18. 40a cannot costitute deviations so long as the carrier has made those stops known to the shipper . . .”). In stop- ping at Balboa, the TITAN SCAN hewed close to the “direct” rout of trav [Text truncated at 120,000 characters. The full text is on the page linked above.] --- Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386008_1362%3A1. Public record. Not legal advice.