AIG Uruguay Compania de Seguros, S.A. v. Landair Transport

902 So. 2d 169, 2005 Fla. App. LEXIS 975, 2005 WL 156740
CourtDistrict Court of Appeal of Florida
DecidedJanuary 26, 2005
DocketNos. 3D03-2241, 3D03-2497
StatusPublished

This text of 902 So. 2d 169 (AIG Uruguay Compania de Seguros, S.A. v. Landair Transport) is published on Counsel Stack Legal Research, covering District Court of Appeal of Florida primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
AIG Uruguay Compania de Seguros, S.A. v. Landair Transport, 902 So. 2d 169, 2005 Fla. App. LEXIS 975, 2005 WL 156740 (Fla. Ct. App. 2005).

Opinion

GREEN, J.

AIG Uruguay Compania de Seguros, S.A. [“AIG”], as subrogee of its insured, Abiatar, S.A., appeals a final summary judgment and a final judgment awarding fees and costs to defendant Landair Transport, Inc. We affirm.

Abiatar purchased cellular phones from Motorola, Inc., at Motorola’s Illinois headquarters for $130,000. Abiatar insured the shipment with AIG. Abiatar contracted with Montevideo International Forwarders, a freight forwarder, to arrange to transport the phones from Illinois to Miami, Florida, and to ship the phones to Uruguay. Montevideo contracted with Sig M. Glukstad, Inc., d/b/a Miami International Freight Forwarders [“MIF”] to arrange for the transportation of the phones. MIF contracted with USA Trading Network, Inc., d/b/a USA Cargo and Courier [“USA Cargo”] to transport the phones to Miami.

USA Cargo issued bill of lading number 100238 to cover the shipment from Illinois to Miami. The bill of lading limited USA Cargo’s liability to “actual damages or $100.00, whichever is less,” unless the shipper paid for and declared a higher authorized value. The declared value was. speck fied as “MF,” or “max free.” In other words, no declared value was indicated on the bill of lading.

USA Cargo contracted with Forward Air, Inc., a licensed property bfoker, to transport the phones to Miami. Forward Air issued airfreight waybill number 3416127 to cover the shipment. The waybill limits the value of the property to “50<t per pound, subject to a $50 minimum.” No value was declared for the property on the waybill. The shipment weighed 3,122 pounds.

Forward Air subcontracted the shipment to Landair Transport, Inc., a contract carrier. Landair and Forward Air had an ongoing shipping relationship formalized in a transportation contract. That contract proscribed Landair’s liability to the same limits in Forward Air’s waybill: fifty cents per pound, unless the shipper declared a value for the property, and the appropriate increased shipping charges for that value were paid. Pursuant to the transportation contract terms, a separate bill of lading for Landair’s transport was not issued: Forward Air’s waybill governed the shipment. While on Landair’s route to Miami, the cargo was lost.

USA Cargo sent Forward Air a claim letter to recover for the lost cargo. Forward Air sent USA Cargo a check for $1,625, pursuant to the liability limitations on airfreight waybill number 3416127. USA Cargo released Forward Air from any further liability. USA Cargo and Forward Air assert that this release was intended to release Landair’s liability as well.

AIG paid Abiatar $139,230 pursuant to the marine insurance “all risk” policy it issued covering the shipment. Abiatar executed a subrogation agreement in AIG’s favor. AIG, as Abiatar’s subrogee, brought suit against all the carriers to recover for the value of the lost cargo. AIG asserted claims under the Carmack Amendment,1 common law negligence, and bailment.

Landair and AIG filed cross-motions for summary judgment. The court denied [171]*171AIG’s motion and entered a final summary judgment in Landair’s favor. The court found that the transportation agreement between Landair and Forward Air was valid and enforceable, and that AIG could not recover from Landair directly, but had to recover from Montevideo, the party with whom its subrogor had contracted. Thereafter, the court entered a final judgment awarding Landair fees and costs. AIG appeals both judgments.

On appeal, AIG asserts that the trial court erred in finding that it did not have standing to sue Landair, and that Landair cannot shelter itself from liability based on the transportation agreement with Forward Air. We address each argument 'in turn.

At the outset, we agree with AIG’s contention that it has standing to sue Lan-dair. It is irrefutable that AIG has standing to sue Landair, and any other carrier, for loss of the shipment. Gulf & Western Indus., Inc, v. Old Dominion Freight Line, Inc., 633 F.Supp. 688 (M.D.N.C. 1986). In Gulf & Western Industries, the dispositive issue was whether the customer of a freight forwarder had a direct action against a carrier hired by the forwarder, and whether the action was subject to the limitation in the contract. Relying on Chi cago, Milwaukee, St. Paul & Pacific Railway Co. v. Acme Fast Freight, 336 U.S. 466, 69 S.Ct. 692, 93 L.Ed. 817 (1949), the court concluded that shippers are permitted to sue underlying carriers for loss or damage occasioned by the carrier. 633 F.Supp. at 692 (quoting Chicago, 336 U.S. at 487 n. 27, 69 S.Ct. 692). See also Boeing Co. v. U.S.A.C. Transp., Inc., 539 F.2d 1228 (9th Cir.l976)(owner sued carrier that lost cargo); Hughes v. United Van Lines, Inc., 829 F.2d 1407 (7th Cir.l987)(home-owners sued carrier and subsidiary with whom they had negotiated for damages to goods destroyed in transit); Feinberg v. Railway Express Agency, 163 F.2d 998 (7th Cir.l947)(owner sued the carrier directly for an item lost in transit); Banos v. Eckerd Corp., 997 F.Supp. 756, 762 (E.D.La.1998)(owner of photographs given to Eckerd, as person beneficially interested in the shipment, has standing to sue carrier under Carmack Amendment). Therefore, we hold the trial court erred in concluding that AIG had no standing to sue Landair.

Athough AIG has established its standing to sue, we do not agree with AIG’s argument that it is entitled to recover the full value of the shipment from Landair. To so hold would contradict well-settled law that liability limitations in bills of lading and shipping agreements are enforceable. Banos, 997 F.Supp. 756; Boeing Co., 539 F.2d 1228; Hughes v. United Van Lines, Inc., 829 F.2d 1407 (7th Cir.1987); Feinberg v. Railway Express Agency, 163 F.2d 998 (7th Cir.1947).

In Banos v. Eckerd Corp., the court explained that

[t]he liability of a carrier for damage to an interstate shipment is controlled by the Interstate Commerce Act. The Car-mack Amendment to the Interstate Commerce Act [49 U.S.C. § 14706] imposes liability on carriers for actual loss, damage, or injury to property they transport, and declares unlawful and void any contract, regulation, tariff, or other attempted means of limiting its liability....
After the adoption of the Carmack Amendment, shippers began to charge exorbitant rates for shipments insured at full value. In reaction, Congress enacted the Cummings Amendment ..., [172]*172which allowed carriers to limit their liability, but granting authority to the ICC to approve rates through tariffs....
Each rate in a tariff carries a corresponding level of liability per pound which is term[ed] a ‘released rate.’ A higher freight rate, therefore, secures a higher level of liability.

Free access — add to your briefcase to read the full text and ask questions with AI

Related

Banos v. Eckerd Corp.
997 F. Supp. 756 (E.D. Louisiana, 1998)
Gulf & Western Industries, Inc. v. Old Dominion Freight Line, Inc.
633 F. Supp. 688 (M.D. North Carolina, 1986)
Dade Cty. Sch. Bd. v. Radio Station WQBA
731 So. 2d 638 (Supreme Court of Florida, 1999)
Feinberg v. Railway Express Agency
163 F.2d 998 (Seventh Circuit, 1947)
Boeing Co. v. U.S.A.C. Transport, Inc.
539 F.2d 1228 (Ninth Circuit, 1976)

Cite This Page — Counsel Stack

Bluebook (online)
902 So. 2d 169, 2005 Fla. App. LEXIS 975, 2005 WL 156740, Counsel Stack Legal Research, https://law.counselstack.com/opinion/aig-uruguay-compania-de-seguros-sa-v-landair-transport-fladistctapp-2005.