IN THIS ISSUE
1. Contract for Land Use of Chassis not Salty Enough
2. Maersk Hit by Cyber-Attack–Terminals Too
3. Norton Rose Fulbright 2017 Report on Transport
4. Arrevederci Bent Metal Loss Adjusting
5. Homage To The Cheque (Or Check) Money
6. People and Places
FOB Network News
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1. Contract for Land Use of Chassis not Salty Enough
The Spring Edition of the Cargo Newsletter edited by Mike Ryan and published by the Maritime Law Association of the United States contains a report on the case of Interpool Inc. v. d/b/a TRAC INTERMODAL v. FOUR HORSEMAN, INC. et al., U.S.D.C. N.J., Civil Action No. 16-2490, Decision of Judge Mary L. Cooper, dated February 8, 2017.
The plaintiff brought suit alleging that defendants breached a maritime contract by utilizing plaintiff’s equipment (chassis) to move maritime cargo without compensating plaintiff.
On defendants’ failure to timely respond, plaintiff moved for entry of default and entry of judgment by default. The Court exercised its obligation to satisfy itself that it had subject matter jurisdiction over the action and ordered plaintiff to show cause why the action should not be dismissed for lack of subject matter jurisdiction.
It also invited the plaintiff to assert an alternative basis for jurisdiction to prevent the action from being dismissed if the Court were to find admiralty jurisdiction lacking. Plaintiff responded, arguing that the Court had both admiralty jurisdiction and diversity jurisdiction.
The Court noted the plaintiff was in the business of leasing maritime equipment, namely chassis, for the movement of cargo. Defendants took the chassis from chassis pools in certain marine ports for delivery of marine cargo to consignees to and from ports of the United States, including, inter alia, the Port of Chicago, and have refused to compensate the plaintiff.
The plaintiff asserted that the containers transported by defendants were carried pursuant to bills of lading, which provided for the landing of the ocean import cargo and continuous on-carriage by train to the railhead and then on plaintiff’s chassis to the ultimate consignee (i.e., defendants took the chassis so that they could transport ocean import cargo pursuant to the final land portion of a “through” bill of lading.
The Court noted initially that it had an obligation to satisfy itself that it had subject matter jurisdiction over a case and then addressed the issue sua sponte. The burden of establishing subject matter jurisdiction is on the plaintiff. As to admiralty jurisdiction, the Court initially referred to the Supreme Court decision of Norfolk S. Ry. Co. v. Kirby, 543 U.S. 14 (2004) and the criteria set forth in that case designated as a conceptual approach:
To ascertain whether a contract is a maritime one…[t]he answer depends upon the nature and character of the contract, and the true criterion is whether it has reference to maritime service or maritime transactions.
It noted the contract involved in this case was not a bill of lading that includes both land and sea components.
Rather, it is a contract to use chassis for the movement of cargo that takes place exclusively on land (i.e., from railhead to consignee). Its primary objective is to provide equipment so that a carrier can accomplish land based transportation. The fact that the Defendants were transporting international cargo pursuant to a “through” bill of lading does not change the nature and character of the separate and distinct contract they had with Plaintiff.
The Court also referred to Mediterranean Shipping Co. (USA) v. Rose, 2008 WL 4694758 (S.D.N.Y. 2008). In that case, the court ultimately found that the agreement involved was “essentially a leasing arrangement allowing defendants to lease transportation equipment, including containers, in order to carry out land-based deliveries pursuant to other contracts for the carriage of goods.” Thus, the court did not have admiralty jurisdiction “[b]ecause the primary objective of the contract is leasing equipment for land transportation, and not maritime commerce.”
The Court distinguished cases offered by Plaintiff and found, based on Plaintiffs’ pleadings and submissions, that the equipment at issue was used exclusively for land transportation. The contract between the parties was not a maritime contract and therefore, the Court did not have Admiralty jurisdiction over the matter.
As to a Rule B attachment, which plaintiff sought, the court found a party may only seek Rule B attachment if the underlying claim satisfies Admiralty jurisdiction.
Because the contract underlying Plaintiffs’ breach of contract claim is not a maritime contract, there is no jurisdictional basis for the Court’s May 17, 2016 orders, granting Plaintiff’s motion for writ of garnishment and for Appointment to Serve Process of Maritime Attachment.
Dealing with the issue of diversity jurisdiction, the Court was satisfied that it had subject matter jurisdiction by virtue of diversity jurisdiction because plaintiff and defendants were citizens of different states and there was an amount in controversy exceeding $75,000.
However, the complaint and additional submissions of the Plaintiff failed to include any allegations regarding or relating to the Defendants’ contacts or activities with relation to the forum state, New Jersey. Because the complaint did not establish a prima facie case of personal jurisdiction, the Court will issue a second order to show cause why the Court should not deny Plaintiff’s motion for entry of judgment by default for lack of personal jurisdiction and dismiss this action.
Additional copies of this newsletter may be requested from:-
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2. Maersk Hit by Cyber-Attack–Terminals Too
Sam Chambers and Splash 24/7 the newszine are developing a fine line in writing good, short pieces on breaking news which have a certain sober ring of authority. The piece below refers:-
http://splash247.com/maersk-contains-cyber-attack-lines-hit/
3. Norton Rose Fulbright 2017 Report on Transport
The latest instalment of this enquiry into the Transport Industry carried out under the auspices of Harry Theochari is subtitled The Way Ahead. The approach is in many ways a model of its kind, a survey of players sector by sector, asking them to rank influencers and drivers and displaying the results in easy to absorb graphics. The report describes a moderately upbeat, anxious industry being driven along by advances in technology, competition, and government regulations. There is evidently an unlawerly tendency to eschew wordage and elipses in favour of summarizing quick to the point exposition. Well worth a read, even by people who are short of time:-
http://transportsurvey.nortonrosefulbright.online/
4. Arrevederci Bent Metal Loss Adjusting
Many of our Readers will have consumed or indeed sourced or produced reports from surveyors, loss adjusters and other fact finders on collisions, allisions scrapesand prangs involving metal objects. A press release from an affiliate of the Alibaba empire suggests that the times are a’changing for this staple of the insuring classes:-
http://www.alizila.com/china-auto-insurance-claims-adjusters-get-ai-boost-ant/
[We wonder what the container leasing and maintenance companies will make of this kind of approach. A unit cost of zip per adjustment might be right up their street-ed]
5. Homage To The Cheque (Or Check) Money
For those of us who over the past two decades have contemplated the incredibly robust qualities investing bills of lading in shipping this piece by P. Koning which appears in the Moneyness blog may help explain the longevity of paper negotiability. We found this item in the Browser:-
Cheques are slow and cumbersome, but “incredibly robust in the face of disasters and banking system shutdowns”. A recipient without a bank account can cash the cheque at the issuer’s bank, or endorse it to pay somebody else. “This combination of negotiability, robustness, openness, and decentralisation means that, long before bitcoin, we had a payments system that allowed pretty much everyone to participate and fabricate their own personal money instruments”
http://jpkoning.blogspot.co.uk/2017/06/an-homage-to-cheque-or-check.html
6. People and Places
The summer newsletter from the people at the Human Rights at Sea organisation reports an NGO in full bloom:-
https://www.humanrightsatsea.org/news/
.———-
Ronny Larsen will join Norwegian Hull Club as the new Head of Charterer´s P&I. His first day with the Club will be 1st October 2017.
Larsen comes with substantial experience from the P&I industry having worked for Assuranceforeningen Skuld for more than 15 years. He has experience from both the claims and underwriting side of the insurance business, and has been heading an Oslo based business unit for Skuld for the last 5 years. Larsen also has a seagoing background and served on board both tankers for Bergesen D.Y. ASA and on Missile Torpedo Boats for the Norwegian Navy.
From the Avo Archive
The website of this newsletter contains all the editorial material since the inception of the Maritime Advocate as a print based quarterly in 1997 under the founding aegis of John Guy, Chris Hewer and Manfred Arnold. Readers can go to the site and search the database on the home page in its entirety. If you are looking for an old case, an old controversy or you would just like to see how many times you and your firm have featured in our annals feel free to access the archive. It is like this e-zine, free to Readers and we always appreciate the support of advertisers and sponsors.
Looking for references to slang in the fine tilth of the Avo Archive, we ran across numerous references. Here is a good one from Issue Issue 68 of 12th August 2002:-
The Janus versions
‘BUMBERSHOOTS’ is a strange word, even for marine insurance. It is the marine equivalent of the non-marine insurance term “umbrella cover.” But clausesmith Janus interprets it differently in his column for the latest issue of the Baltic Magazine, out this month.
According to Janus, ” ‘Bumbershoots’ is an American slang term. Like all American slang terms, it makes no sense whatsoever. Examples of other American slang terms which make no sense whatsoever include American football, cleats, grape jelly, the World Series, and Treat Williams.
“Bumbershoots have been compared to umbrella cover, but only when there is a lull in the conversation, and only when they are open.
“But for an attack of ennui on the part of a Wall Street average adjuster, it is quite possible that bumbershoots may never have been invented, thus depriving us of what is truly one of the silliest words north of Cape Hatteras. The average adjuster, bored with copying data more or less blindly from the Frozen Mutton Clauses, resorted to counting his fingers, omitting every second one, before turning his mind to the question of general liability of a marine nature. Bumbershoots is what he came up with. This is a mark of just how bored he really was, thus giving rise to Dr Johnson’s observation that, when a man is tired of London, I’ll show you the man.
“Bumbershoots are not to be confused with – nor are they likely to be – bumboats, which is an American slang term for vessels which are engaged in selling and supplying stores alongside ships in port. In some countries, this practice is being done away with, and not before time.
“Bumboats were so named because the man who thought up the word wanted it to appear in reference books immediately after ‘bumbershoots’ and immediately before ‘bumboatman’. In the same way, the American slang group The Beau Brummels chose their name so that their albums would appear in record shop bins immediately after those of The Beatles.
“Frozen mutton, meanwhile, is not to be confused with unfrozen mutton, which is much warmer. Neither is it to be confused with frozen assets, which is money or capital which is a doormat – or possibly dormant – and cannot be utilised.
“Finally, frozen meat is carried at an ambient temperature of ninety-five degrees Celsius. Celsius was a Swedish astronomer who would be 358 tomorrow if he were still alive today, and whose name was changed to Deed Poll by Centigrade. Discuss.
“More about full container loads next time.”
Australian Vernacular
The new Australian National Dictionary features many examples from a hospitable host for laugh out loud slang. Barry Humphries reviews in the TLS:-
http://www.the-tls.co.uk/articles/public/australian-slang-humphries/
Letters of Recommendation For Slightly Underwhelming Employees
For the chronically absent:
“A man like him is hard to find.”
“It seemed his career was just taking off.”
For the office drunk:
“I feel his real talent is wasted here.”
“We generally found him loaded with work to do.”
For an employee with no ambition:
“He could not care less about the number of hours he had to put in.”
“You would indeed be fortunate to get this person to work for you.”
“He consistently achieves the standards he sets for himself.”
For an employee who is so unproductive that the job is better left unfilled:
“I can assure you that no person would be better for the job.”
For an employee who is not worth further consideration as a job candidate:
“I would urge you to waste no time in making this candidate an offer of employment.”
“All in all, I cannot say enough good things about this candidate or recommend him too highly.”
[Paul Dixon]