Admiralty - Colin A. Mcrae and Edgar M. Smith
| Publication year | 2011 |
Admiralty
by Colin A. McRae* and Edgar M. Smith**
I. The Supreme Court of the United States: Bills of Lading
In Kawasaki Kisen Kaisha, Ltd. v. Regal-Beloit Corp.,1 the Supreme Court of the United States had the opportunity to clarify whether 49 U.S.C. §§ 14706-147112 (the Court refers to these sections as the Carmack Amendment) applies to the inland rail transit portion of the international shipment of an intermodal container under a through bill of lading.3 The factual circumstances giving rise to the dispute were quite similar to the facts in the recent cargo case of Norfolk Southern Railway Co. v. James N. Kirby, Pty Ltd.,4 as both cases involved international shipment of cargo to the United States under a through bill of lading during which the cargo was damaged on the inland rail leg of the shipment.5 The cargo interests-owners-in this case shipped on a "K" Line vessel. Certain containerized goods from China were damaged when the Union Pacific train carrying them from Long Beach to the Midwestern United States derailed in oklahoma.6
* Partner in the firm of Hunter, Maclean, Exley & Dunn, P.C., Savannah, Georgia. Yale University (B.A., 1995); University of Georgia School of Law (J.D., cum laude, 1999). Member, Savannah Bar Association. Member, State Bar of Georgia. Member, Maritime Law Association of the United States. Member, Southeastern Admiralty Law Institute.
** Associate in the firm of Hunter, Maclean, Exley & Dunn, P.C., Savannah, Georgia. Georgia Southern University (B.B.A., summa cum laude, 2001); University of Georgia School of Law (J.D., cum laude, 2006). Member, Savannah Bar Association. Member, State Bar of Georgia. Member, Southeastern Admiralty Law Institute.
1. 130 S. Ct. 2433 (2010).
2. 49 U.S.C. §§ 14706-14711 (2006).
3. Kawasaki, 130 S. Ct. at 2442.
4. 543 U.S. 14 (2004).
5. Compare id. at 18, with Kawasaki, 130 S. Ct. at 2438-39.
6. Kawasaki, 130 S. Ct. at 2439.
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The bill of lading documentation covering the subject shipment contained, among other provisions, a forum selection clause requiring that any action relating to the rail carriage of the cargo be brought in Tokyo, Japan. Despite this forum selection clause, the cargo interests filed suit in the Superior Court of Los Angeles County, California for the damage to the cargo. The defendants, including both vessel interests and the rail carrier, removed the litigation to the United States District Court for the Central District of California and filed a motion to dismiss based on the Tokyo forum selection clause.7
After the district court granted the motion to dismiss, the United States Court of Appeals for the Ninth Circuit reversed on the grounds that "the Carmack Amendment applied to the inland portion of an international shipment under a through bill of lading" and concluded that the Carmack Amendment invalidated the parties' forum selection clause.8 Noting that this interpretation of the scope of the Carmack Amendment was inconsistent with the stance taken by United States Courts of Appeals for the Fourth, Sixth, Seventh, and Eleventh Circuits, the Supreme Court granted certiorari to resolve the circuit split.9
The Supreme Court began with an examination of the Carriage of Goods by Sea Act (COGSA),10 which does not limit the parties' ability to adopt forum selection clauses, before turning its attention to the Carmack Amendment.11 While acknowledging that the Carmack Amendment does limit the parties' ability to choose the venue of their suit, the Court took a closer look at the scope of the Carmack Amendment's applicability and rejected the cargo interests' contention that the Carmack Amendment applied to the domestic inland segment of the carriage in this case.12
The Court focused on the Carmack Amendment's three different classifications of carriers: "(1) receiving rail carriers; (2) delivering rail carriers; and (3) connecting rail carriers."13 "A 'receiving rail carrier' is one that 'provid[es] transportation or service . . . for property it receives for transportation under this part.'"14 "A 'delivering rail carrier'" is one that "delivers the property and is providing transportation or service subject to the jurisdiction of the [Surface Transportation Board]
7. Id. at 2439-40.
8. Id. at 2440 (citing Regal-Beloit Corp. v. Kawasaki Kisen Kaisha, Ltd., 557 F.3d 985, 994-95 (9th Cir. 2009)).
9. Id.
10. 46 U.S.C. §§ 30701-30707 (2006).
11. Kawasaki, 130 S. Ct. at 2440.
12. Id. at 2441-42.
13. Id. at 2442.
14. Id. (alteration in original); see also 49 U.S.C. § 11706(a).
2011] ADMIRALTY 1055
under this part,"15 while "[a] connecting rail carrier is 'another rail carrier over whose line or route the property is transported in the United States . . . under a through bill of lading.'"16 Only a receiving rail carrier is required to issue a Carmack-compliant bill of lading. Therefore, the important question became whether a rail carrier transporting goods during the inland portion of a through bill oflading shipment constituted a receiving rail carrier for the purpose of the Carmack Amendment.17
The text of the Carmack Amendment provides that a receiving rail carrier must be one that "receives" the cargo "for domestic rail transportation at the journey's point of origin."18 Under a through bill of lading, in which the cargo is received at an overseas location for transport to an inland location in the United States, there is no receiving rail carrier that receives the property at the journey's point of origin for domestic rail transportation.19 Accordingly, the rail carrier was not required to issue a Carmack-compliant bill of lading.20
In the case at bar, since defendant "K" Line was not a receiving rail carrier and Union Pacific constituted a delivering carrier who was not required to issue a Carmack bill of lading, no Carmack bill of lading was required.21 Since the Carmack Amendment's limitation on the parties' ability to agree to a forum selection did not apply to this shipment, the forum selection clause was enforceable, and the judgment of the Ninth Circuit was reversed.22
II. THE UNITED STATES COURT OF APPEALS FOR THE ELEVENTH CIRCUIT
A. The Public Vessels Act vs. The Suits in Admiralty Act
In Uralde v. United States,23 the United States Coast Guard (Coast Guard) was sued by the estate of a deceased Cuban national in a case that called upon the Eleventh Circuit to examine the extent to which the
15. Kawasaki, 130 S. Ct. at 2442 (internal quotation marks omitted); see also 49 U.S.C. § 11706(a).
16. Kawasaki, 130 S. Ct. at 2443; see also 49 U.S.C. § 11706(a)(3).
17. Kawasaki, 130 S. Ct. at 2443.
18. Id. (internal quotation marks omitted); see also 49 U.S.C. § 11706(a).
19. Kawasaki, 130 S. Ct. at 2444.
20. Id.
21. Id. at 2444-45.
22. Id. at 2449.
23. 614 F.3d 1282 (11th Cir. 2010).
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Public Vessels Act (PVA)24 and the Suits in Admiralty Act (SAA)25 allow waiver of sovereign immunity.26 The plaintiff, Augustin Uralde, and his wife, Anay, attempted to enter the United States illegally as passengers on board a speedboat. After a high speed chase, the Coast Guard successfully disabled the speedboat by firing two shotgun rounds into its engine. The sudden stop of the vessel caused Anay to forcefully hit her head on the side of the boat, leading to her loss of consciousness and bleeding from her head, nose, and ears.27
Augustin pleaded with responding Coast Guard personnel to evacuate Anay to a hospital immediately by using one of the Coast Guard aircraft hovering over the scene. This request was allegedly sent up the chain of command to Station Key West on two occasions but was denied both times. Once a physician's assistant arrived on board the speedboat an hour after the accident, he evaluated Anay's condition and recommended she be immediately airlifted to a medical facility. That recommendation was also denied, and Anay was ultimately taken ashore by way of an inflatable boat. She died in transit before reaching land.28
Augustin sued the Coast Guard under the SAA and the Federal Tort Claims Act (FTCA)29 for negligence in failing to provide proper on-scene care or timely transportation to medical facilities and for unreasonably delaying a proper diagnosis of his deceased wife's medical needs.30 The United States District Court for the Southern District of Florida found that the case fell under the PVA, rather than the SAA, and that the plaintiff failed to make a proper showing that the circumstances of his case provided for a waiver of the Coast Guard's sovereign immunity under the PVA.31 The PVA contains a requirement that, to overcome the sovereign immunity enjoyed by agencies ofthe United States government, the plaintiff must show that his country of citizenship would reciprocally allow a United States citizen to sue under similar circum-stances.32 As Mr. Uralde was not able to prove that Cuba offers such reciprocity to United States citizens, the district court dismissed for lack of subject matter jurisdiction under the PVA.33
24. 46 U.S.C. §§ 31101-31113 (2006).
25. 46 U.S.C. §§ 30901-30918 (2006).
26. Uralde, 614 F.3d at 1283-84.
27. Id. at 1284.
28. Id.
29. 28 U.S.C. §§ 1346, 2671-2680 (2006).
30. Uralde, 614 F.3d at 1284.
31. Id. at 1284-85.
32. 46 U.S.C. § 31111.
33. Uralde, 614 F.3d at 1285.
2011] ADMIRALTY 1057
The Eleventh Circuit reversed on the grounds that the case did in fact fall under the SAA, which has no reciprocity prerequisite to jurisdiction, rather than the PVA.34 The court explained that the PVA is more narrowly drafted to govern only those "[c]laims seeking relief for damages caused directly by a public vessel, or by the negligent operation thereof," while "[t]he SAA covers all remaining admiralty claims, including those simply 'involving public vessels.'"35 The plaintiff's claims of negligence on the part of the Coast Guard did not stem from the operation of a public vessel but instead involved the Coast Guard's decisions regarding how, and...
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