890 F. Supp. 2d 360
S.D.N.Y.2012Background
- APL sues Kemira Water Solutions and Fairyland for breach of contract, negligence, and CERCLA contribution over two shipments of ferrous chloride leaked due to packaging.
- Sea waybills identified Fairyland as shipper and Kemira as consignee; the sea waybills allegedly incorporated APL’s terms and conditions.
- Ferrous chloride is Class 8 corrosive under the IMDG Code; the shipments caused substantial damage to APL’s vessels.
- Purchase Agreement between Kemira and Fairyland (Aug. 3, 2006) set packaging specifications in Schedule A.
- AP L argues Kemira is bound to APL’s Terms and Conditions via acceptance theories; the court must determine contract formation under federal maritime law.
- Proceedings proceeded on cross-motions for summary judgment on liability; the court granted in part and denied in part.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Kemira is bound by the Terms and Conditions on the sea waybills. | APL asserts Kemira accepted the Terms and Conditions through (i) course of conduct, (ii) dominion over cargo, and (iii) invocation of the forum clause. | Kemira argues it never accepted the Terms and Conditions; there is no evidence Kemira received or assented to the reverse side or terms; agency and other theories fail. | Kemira not bound by the Terms and Conditions. |
| Whether agency or other doctrine binds Kemira to the sea waybills' terms. | APL relies on agency and course-of-dealing theories to bind Kemira. | No agency relationship shown; Fairyland was not acting as Kemira's agent for the sea waybills. | Agency theory does not bind Kemira; acceptance not shown. |
| Whether the CERCLA claim against Kemira succeeds based on facility and PRP status. | Bags holding ferrous chloride are facilities; Kemira is a PRP as operator under CERCLA §9607(a)(2). | Kemira argues §9601(20)(B) shields it when circumstances are beyond its control; disputes over packaging specs remain. | APL's CERCLA claim survives; Kemira is a PRP; bags are facilities; summary judgment for APL on CERCLA. |
| Whether Kemira owed a negligence duty to APL. | APL contends buyer liability or special knowledge creates a duty. | Under federal maritime law, buyers generally owe no duty to carriers absent special knowledge or control. | No duty owed by Kemira; negligence claim dismissed. |
Key Cases Cited
- In re M/V Rickmers Genoa Litig., 622 F.Supp.2d 56 (S.D.N.Y.2009) (binding terms and agency concepts in maritime contracts; CERCLA considerations later)
- Norfolk S. Ry. Co. v. Kirby, 543 U.S. 14 (Supreme Court 2004) (basis for federal common law in maritime contract interpretation)
- Taisheng Int’l Ltd. v. Eagle Mar. Servs., Inc., 2006 WL 846380 (S.D. Tex. 2006) (courts may bind consignee to terms via acceptance or agency)
- United States v. M/V Santa Clara I, 887 F.Supp.825 (D.S.C.1995) (shipper determination under CERCLA; facilities/PRP analysis)
- Niagara Mohawk Power Corp. v. Chevron U.S.A., Inc., 596 F.3d 112 (2d Cir.2010) ( CERCLA damages and broad remedial purpose; liberal construction)
- Brown v. Volante Corp., 194 F.3d 351 (2d Cir.1999) (course of conduct can evidence acceptance of unsigned contract terms)
- Sealand Service, Inc. v. Landis, 1996 WL 4120 (E.D. Pa. 1996) (ten-year course of dealing can bind consignees to terms)