Interested Underwriters at Lloyd's v. Sebastian

508 F. Supp. 2d 1243, 2007 U.S. Dist. LEXIS 24817, 2007 WL 1087371
CourtDistrict Court, N.D. Georgia
DecidedApril 3, 2007
Docket1:03-cv-1778-WSD
StatusPublished
Cited by3 cases

This text of 508 F. Supp. 2d 1243 (Interested Underwriters at Lloyd's v. Sebastian) is published on Counsel Stack Legal Research, covering District Court, N.D. Georgia primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Interested Underwriters at Lloyd's v. Sebastian, 508 F. Supp. 2d 1243, 2007 U.S. Dist. LEXIS 24817, 2007 WL 1087371 (N.D. Ga. 2007).

Opinion

OPINION AND ORDER

WILLIAM S. DUFFEY, Jr., District Judge.

This matter is before the Court on Plaintiffs Interested Underwriters at Lloyd’s (“Lloyd’s”) and Thai Tokai Product Co., Ltd. (“Thai Tokai”) (collectively, “Original Plaintiffs”) Motion to Compel Arbitration. [61]. Also before the Court is Defendant Oilmar Co. Ltd.’s (“Oilmar”) Motion to Strike Plaintiffs’ Cargo Claim [79], and various discovery and trial-related motions raised by Oilmar [78, 84, 85],

I. BACKGROUND

Oilmar owns the ship M/T San Sebastian, 1 (“San Sebastian”). On March 7, 2003, Oilmar entered into a charter party agreement (the “Charter Party”) with Energy Transport Ltd. (“ETL”). The Charter Party provided for the San Sebastian to carry carbon black feedstock (“carbon black”) sold by ETL from the United States to a purchaser in Thailand. ETL agreed to pay a set “freight rate” for the use of the San Sebastian in shipping the carbon black. Oilmar is a Panama corporation, and the San Sebastian is its only asset. ETL is a United States corporation and a wholly owned subsidiary of the P.T. Cabot Corporation (“P.T.Cabot”), which has intervened as a Plaintiff in this action.

ETL’s carbon black did not require the entire cargo space of the San Sebastian. Under the Charter Party, however, ETL was obligated to charter the San Sebastian’s entire cargo space. The Charter Party permitted ETL to sub-charter any cargo space that it did not itself use. ETL chartered the remaining space on the San Sebastian to two companies, Pacific Oil *1247 and Adam Maritime, through sub-charter party agreements. Adam Maritime is the shipping arm of Glencore Ltd. (“Glen-core”), which had sold and agreed to deliver carbon black to Thai Tokai in Thailand. Lloyd’s underwrote insurance for the carbon black feedstock purchased by Thai Tokai, and is subrogated to Thai Tokai for the purposes of this litigation.

The Charter Party dictated the terms upon which ETL could sub-charter cargo space on the San Sebastian. The Charter Party required sub-charters to be issued largely on the same terms, except for freight rate, as the Charter Party between Oilmar and ETL. The Charter Party also prescribed the form required for any Bills of Lading 2 for sub-chartered goods. The Charter Party provided expressly that “[t]he Master shall, upon request, sign Bills of Lading in the form appearing below for all cargo shipped but without prejudice to the rights of the Owner and Charterer under the terms of this Charter.” (Charter Party, ¶ 20.) The Bill of Lading form required by the Charter Party states that “all the terms whatsoever of [the Charter Party] exeept the rate and payment of freight specified therein apply to and govern the rights of the parties connected in this shipment.”

Three bills of lading were executed for the shipments of carbon black on the San Sebastian. Bills of lading were held by ETL, Carbon Black, and Thai Tokai. The Bill of Lading for the goods belonging to Thai Tokai was issued “on behalf of the Master” of the San Sebastian.

During the voyage, an explosion and fire occurred on the San Sebastian. The fire damaged some of the cargo, and damaged the San Sebastian so severely that the undamaged carbon black had to be transferred to another vessel for delivery.

After the San Sebastian fire, P.T. Cabot, Carbon Black, and Thai Tokai (and Lloyd’s as Thai Tokai’s subrogee) sued the San Sebastian and Oilmar in various courts, including this Court, the District of Connecticut, and the Southern District of New York, seeking damages.as a result of the fire and arguing, among other things, that the San Sebastian was unseaworthy. This action was filed by Lloyd’s and Thai Tokai. P.T.. Cabot, and their subrogated insurer, intervened as Plaintiffs.

At issue in the present motions is whether the Original Plaintiffs may compel Oil-mar to arbitrate their claims pursuant to the arbitration clause’ in the Charter Party between Oilmar and ETL. That arbitration clause states, “Any and all differences and disputes of whatsoever nature arising out of this Charter shall be put to arbitration ...” (Charter Party, ¶ 24).

The Original Plaintiffs argue that Oil-mar is obligated to arbitrate under the Charter Party under theories of contract and equitable estoppel. Oilmar also moves to strike the Original Plaintiffs’ claim for damage to the cargo. A series of discovery and trial motions raised by Oilmar are also pending.

II. DISCUSSION

The manner in which this dispute has been litigated is troubling. The Original Plaintiffs’ litigation strategy appears to involve a calculated effort to prolong this action by substantially refusing to participate in discovery until they can see what happens in the “real” litigation in Connecticut. The Original Plaintiffs do not deny that they have chosen this tactic, and they now seek to delay this action further by moving to compel arbitration, more than *1248 three years after they filed their complaint in the case.

Both Oilmar and the Original Plaintiffs, but particularly Oilmar, have further complicated the present action by filing excessive numbers of motions supported by briefing unreasonable in both content and volume, and which ignores page limitation and other requirements of the Local Rules.

The parties are admonished that any further submissions which fail to comply with the page, type, and other requirements of the Local Rules will be refused, and returned to counsel. The parties are further counseled that, contrary to their practice thus far, regard for and citation to the laws and precedent which bind this Court are the sine qua non of persuasive advocacy. After more than three years of apparently deliberate delay tactics and excessive motion practice, it is time to bring this case to resolution.

A. Motion to Strike Cargo Claim

On May 10, 2004, the Original Plaintiffs moved the Court for permission to amend their complaint to add a claim for damage to cargo in the amount of $65,000, and to add a claim for indemnification against future salvage payments. On March 24, 2005, the Court granted this motion in part, permitting the Original Plaintiffs to add the cargo damage claim only. Oilmar alleges that the Original Plaintiffs have refused to provide discovery of any kind related to the cargo damage claim. Oilmar claims specifically that the Original Plaintiffs have expressly and repeatedly refused to answer interrogatories or produce witnesses to be deposed in connection with the cargo damage claim.

Under Federal Rule of Civil Procedure 37(d), if a party refuses to appear at a deposition or to serve answers or objections to interrogatories, “the court in which the action is pending on motion may make such orders in regard to the failure as are just.” According to the Advisory Counsel notes, Rule 37(d) is intended “to make clear that a party may not properly remain completely silent even when he regards a ... a set of interrogatories ... as improper and objectionable.

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Cite This Page — Counsel Stack

Bluebook (online)
508 F. Supp. 2d 1243, 2007 U.S. Dist. LEXIS 24817, 2007 WL 1087371, Counsel Stack Legal Research, https://law.counselstack.com/opinion/interested-underwriters-at-lloyds-v-sebastian-gand-2007.