Allied International American Eagle Trading Corp. v. S.S. Yang Ming Her Engines

This appeal calls into question the package liability limitation imposed by section 4(5) of the Carriage of Goods by Sea Act (""COGSA""), 46 U.S.C. § 1304(5). The defendant, Yang Ming Marine Transport Corporation (""Yang Ming""), a Taiwanese company, is the owner and operator of the S.S. Yang Ming, on which was shipped a cargo of screws, bolts, nuts, studs, and washers, to be delivered to its purchaser, the plaintiff Allied International American Eagle Trading Corporation (""Allied""). The cargo was never delivered, for which the defendant concedes liability, but the parties disagree on the proper damage limitation. The missing goods were packed on two pallets, one holding nine cartons, the other holding ten drums of cargo. The defendant contends that the pallets should be considered ""packages"" within the meaning of the statutory $500 limitation, while the plaintiff argues that each carton and drum should be considered a ""package."" After a one-day bench trial, the district court made findings of fact and conclusions of law in the plaintiff's favor. Accordingly, the defendant was held liable for the loss of 19 packages, which were valued at $8500. We reverse and hold that, under the circumstances of this case, the two pallets should be considered ""packages"" under the statute, thus subjecting the defendant to a maximum liability of $1000. In this case, under the heading ""No. of Containers or P'kgs.,"" the bill of lading listed eighteen pallets, two cases, and ten drums, with a total listed as ""30 Packages."" Under the heading ""Description of Packages and Goods,"" there is a parenthetical listing of the number of cartons, cases and drums on each pallet, as well as the point of origin and a general legend reading ""Screws, Bolts, Nuts, Studs."" Below all of this information, a printed line requires the parties to fill in the ""Total Number of Packages or Units (in words),"" after which is typed ""Thirty (30) Packages Only."" In the opinion below, the court considered the parenthetical descriptions to come under the heading ""No. of Containers or P'kgs."" We disagree,1 but even if they had, we are convinced that the case is controlled by the explicit statements in the bill of lading that the total number of packages was thirty. In order to reach a total of thirty, one must count the pallets as ""packages.""2