Chubb Insurance Co. of Europe S.A. v. Menlo Worldwide Forwarding, Inc.
2011 U.S. App. LEXIS 2492
| 9th Cir. | 2011Background
- Engine damaged during international transport from New Zealand to the United States; Chubb paid the engine owner $119,666.62 under the Montreal Convention.
- Chubb sued UPS (to recover paid sums) in federal court based on UPS's liability under the Montreal Convention for international air carriage of cargo.
- Settlement later: UPS agreed to pay Chubb $80,000.
- UPS filed a third-party complaint against Qantas seeking indemnification and contribution for amounts paid to Chubb.
- District court dismissed the third-party complaint as barred by Article 35's two-year limit on the right to damages; UPS appealed.
- The Ninth Circuit addressed whether Article 35 applies to third-party indemnification/contribution claims between carriers and whether other Montreal Convention provisions govern timing.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does Article 35 bar UPS's third-party indemnity claim against Qantas? | UPS—right is for recourse, not damages; Article 35 does not extinguish recourse rights. | Chubb argues Article 35 extinguishes any rights to damages; third-party claim is untimely. | No; Article 35 does not apply to indemnification/contribution between carriers. |
| Does Article 37 affect extinguishment of recourse rights in third-party actions? | Article 37 protects recourse rights among liable parties; interpretation should preserve recourse. | Article 37 creates no extra bar beyond Article 35's limits. | Article 37 allows recourse without triggering Article 35's two-year limit on damages. |
| What governs timing for third-party indemnity/contribution actions under the Montreal Convention? | When a carrier seeks recourse, timing is governed by local law, not Article 35. | Article 35 should govern timing as it supersedes conflicting regimes. | Timing is governed by local law; Article 45 provides procedures and joinder rights; Rule 14 applies to third-party actions. |
Key Cases Cited
- Medellin v. Texas, 552 U.S. 491 (U.S. 2008) (text controls interpretation of treaties when clear)
- Chan v. Korean Air Lines, Ltd., 490 U.S. 122 (U.S. 1989) (text governs treaty interpretation; no reliance on drafting history when unambiguous)
- Motorola, Inc. v. MSAS Cargo Int’l, Inc., 42 F. Supp. 2d 952 (N.D. Cal. 1998) (pre-Montreal Warsaw precedent on indemnity/contribution cited)
- Data Gen. Corp. v. Air Express Int’l Co., 676 F. Supp. 538 (S.D.N.Y. 1988) (pre-Montreal Warsaw precedent; indemnity/contribution framework)
- Sompo Japan Ins., Inc. v. Nippon Cargo Airlines Co., Ltd., 522 F.3d 776 (7th Cir. 2008) (Montreal/Warsaw conventions and recourse concepts; carriers’ inter se actions)