Mediterranean Shipping Company (USA) Inc. v. Worldwide Freight Services, Inc. et al

Filing 23

OPINION AND ORDER re: 12 FIRST MOTION for Summary Judgment Notice of Motion. filed by Mediterranean Shipping Company (USA) Inc. Accordingly, for all the foregoing reasons, plaintiff's motion for summary judgement is granted with respec t to demurrage charges and pre-judgment interest and is denied with respect to all other charges. MSC is directed to advise me within fourteen (14) days whether it wishes to pursue its claims for administrative fees and attorneys' fees. If MSC e lects to forego these other fees, the Clerk will be directed to enter judgment against defendant for demurrage charges in the amount of $14,340 plus interest calculated at the average 4-Week Treasury Bill rate for the period between October 5, 2 011 and the date of judgment and in the amount of $19,264 plus interest calculated at the average 4-Week Treasury Bill rate for the period between October 24, 2011 and the date of judgment. (Signed by Magistrate Judge Henry B. Pitman on 8/29/2012) Copies Sent By Chambers. (djc)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
-----------------------------------X
MEDITERRANEAN SHIPPING COMPANY,
(USA) INC.,

:
:

Plaintiff,

10 Civ. 9445 (HBP)
:

-against:
WORLDWIDE FREIGHT SERVICES, INC.,
T/A UNITED AMERICAN LINE,
Defendant.

OPINION
AND ORDER

:
:

-----------------------------------X

PITMAN, United States Magistrate Judge:

I.

Introduction

Plaintiff Mediterranean Shipping Company (USA), Inc.,
("MSC") brought this action to recover demurrage and other
charges which have accrued with respect to two containers MSC
carried in 2009 for the benefit of defendant, Worldwide Freight
Services, Inc., trading as, United American Line ("UAL") (Complaint, dated Dec. 15, 2010 (Docket Item 1) passim).
seeks to recover its legal fees (Complaint ¶ 27).

MSC also

The parties

consented to my exercising plenary jurisdiction pursuant to 28
U.S.C. § 636(c).
1333.

Federal jurisdiction is based on 28 U.S.C. §

By notice of motion dated October 7, 2011 (Docket Item
12), MSC moves for summary judgment.

For the reasons set forth

below, MSC's motion is granted with respect to demurrage charges
and pre-judgment interest and is denied with respect to all other
charges.

II.

Facts

MSC has submitted a statement of undisputed facts
pursuant to Local Civil Rule 56.1 which it contends have been
established either through documentary evidence or by a declaration submitted in connection with its motion1 (Plaintiff's Rule
56.1 Statement of Uncontested Facts, dated Oct. 7, 2011 (Docket
Item 18)("Pl.'s 56.1 St.")).
UAL has failed to submit its own 56.1 statement.
Accordingly, the facts set forth in Pl.'s 56.1 St. are deemed
admitted.

Pearson v. Lynch, 10 Civ. 5119 (RJS), 2012 WL 983546

at *1 n.1 (S.D.N.Y. Mar. 22, 2012) (Sullivan, D.J.), citing Local
Civ. R. 56.1(c), and Gitlow v. United States, 319 F. Supp. 2d

1

Some facts below are drawn directly from the Declaration
of Jorge Boose, dated Oct. 7, 2011 and attached exhibits.
Although it appears that the Boose Declaration was never filed on
the Court's docket, the defendant references it in his affidavit
in opposition (Docket Item 21 at ¶ 10) and a courtesy copy was
provided to my chambers. Accordingly, I consider the Boose
Declaration as if it had been properly filed on the Court's
docket and part of the record in this matter.
2

478, 480 (S.D.N.Y. 2004) (Kaplan, D.J.).

Nevertheless, MSC must

still show that it is entitled to judgment as a matter of law
based on evidence in the record.

Holtz v. Rockefeller & Co., 258

F.3d 62, 74 (2d Cir. 2001).

A.

Background

MSC is a New York company which acts on behalf of its
principal, Mediterranean Shipping Company of Geneva, SA, a Swiss
entity, to book cargo for carriage originating in the United
States and to collect demurrage that has accrued on containers
that were used for such shipments (Pl.'s 56.1 St. at ¶¶ 1-2,
citing Declaration of Jorge Boose, dated Oct. 7, 2011 ("Boose
Decl.") ¶ 3).
MSC, together with its principal, carries containerized
cargo pursuant to a standard form bill of lading that includes
terms and conditions on the back side of the bill of lading and
in MSC's tariff, which is maintained with the Federal Maritime
Commission and incorporated by reference in the bill of lading
(Pl.'s 56.1 St. at ¶ 5, citing Boose Decl. ¶¶ 11-12 & Exhibit A).
Shippers of cargo with MSC have a fixed number of days
to use and return MSC's container, known as "free-time"; if a
shipper fails to return MSC's container within the free-time, MSC

3

will charge the shipper a fee for demurrage (Pl.'s 56.1 St. at ¶¶
3-4, citing Boose Decl. ¶ 6).

B.

Shipment to Jordan

MSC carried a 40-foot high-cubed shipping container
bearing a registration number TTNU9727365 ("Container '365"),
pursuant to bill of lading number MSCUNQ619164, from New York
City to Al Aqaba, Jordan, on August 16, 2009 (Pl.'s 56.1 St. at ¶
6, citing Boose Decl. ¶¶ 16-17; Exhibit B to Boose Decl.).

UAL

is listed as the shipper on the bill of lading (Pl.'s 56.1 St. at
¶ 7, citing Exhibit B to Boose Decl.).
Container '365 was discharged in Jordan on September
28, 2009 and notice of arrival was given to the consignee who was
listed on the bill of lading as the party to be notified when the
container arrived at the destination port (Pl.'s 56.1 St. at ¶ 9;
Boose Decl. ¶ 16).

When Container '365 was not cleared during

the allowed free-time, MSC contacted UAL at some point prior to
June 18, 2010 (Boose Decl. ¶ 16).

MSC also contacted UAL after

June 18, 2010 by email, and by Certified Mail on October 29, 2009
and February 11, 2010 (Boose Decl. ¶ 16 & Exhibit C).

Container

'365 remained at the port in Jordan until MSC was notified by the
"local authorities," on October 5, 2011, that the container had
been emptied and the contents disposed of; MSC was not informed
4

as to the actual disposition of the cargo (Pl.'s 56.1 St. at ¶
10; Boose Decl. ¶¶ 7, 16).
MSC's tariff governing the use of its equipment at Al
Aqaba, Jordan provided for 15 days of free-time for a container
the size of Container '365, followed by demurrage at a rate of
$10 per day for the first 10 days and $20 for each day thereafter
(Pl.'s 56.1 St. at ¶ 11, citing Boose Decl. ¶ 17 & Exhibit D).
As a result of UAL's failure to return Container '365 to MSC
during the allowed free-time, MSC seeks $14,340 in demurrage
charges,2 $50 for a "MSC administrative fee," $190 for "customs
inspection," and $250 for "trucking/devanning"3 (Pl.'s 56.1 St.
at ¶ 12; Boose Decl. ¶ 17 & Exhibit D).

C.

Shipment to Kenya

MSC also carried a 40-foot high-cubed shipping container bearing a registration number GSTU9751230 ("Container
'230"), pursuant to bill of lading number MSCULB483885, from
Baltimore, Maryland to Mombasa, Kenya, on September 15, 2009
(Pl.'s 56.1 St. at ¶ 6, citing Boose Decl. ¶¶ 18-19; Exhibit E to

2

10 days at $10 per day and 712 days at $20 per day.

3

Pl.'s 56.1 statement is inconsistent with the Boose Decl.
in the exact amount MSC seeks with respect to Container '365. I
use the amounts listed in the Boose Decl. at ¶ 17.
5

Boose Decl.).

UAL is listed as the shipper on the bill of lading

(Pl.'s 56.1 St. at ¶ 7, citing Exhibit E to Boose Decl.).
Container '230 was discharged in Kenya on November 14,
2009 and notice of arrival was given to the consignee who was
listed on the bill of lading as the party to be notified when the
container arrived at the destination port (Boose Decl. ¶ 18).
When Container '230 was not cleared during the allowed free-time,
MSC contacted UAL at some point prior to June 18, 2010 (Boose
Decl. ¶ 18).

MSC also contacted UAL after June 18, 2010 by

email, and by Certified Mail on January 11, 2010 and February 12,
2010 (Boose Decl. ¶ 18 & Exhibits C and F).

At the time this

motion was filed, Container '230 remained unclaimed at the port
in Kenya (Boose Decl. ¶¶ 7, 18).
MSC's tariff governing the use of its equipment at
Mombasa, Kenya provided for 14 days of free-time for a container
the size of Container '230, followed by demurrage at a rate of $8
per day for the first 7 days, $20 per day for the next 7 days,
and $28 for each day thereafter (Boose Decl. ¶ 19 & Exhibit G).
As a result of UAL's failure to return Container '230 to MSC
during the allowed free-time, MSC seeks $19,264 in demurrage

6

charges,4 and $135 for a "terminal handling charge Mombasa"5
(Pl.'s 56.1 St. ¶ 15; Boose Decl. ¶ 19 & Exhibit G).

D.

Bill of Lading Terms

The uniform set of terms and conditions which govern
the relationship between MSC and a merchant who utilizes its
shipping services appear on the reverse side of MSC's form bill
of lading (Boose Decl. ¶ 12).
MSC's bill of lading defines the term "merchant" to
include the shipper (Boose Decl. ¶ 13 & Exhibit A § 1).

MSC's

bill of lading provides that "merchants" are jointly and severally liable for the charges and undertakings due under the bill
of lading:
2. Contracting Parties and Warranty:
The contract evidenced by this Bill of Lading is between the Carrier and the Merchant. Every Person
defined as "Merchant" is jointly and severally liable
towards the Carrier for all the various undertakings,
responsibilities and liabilities of the Merchant under
or in connection with this Bill of Lading and to pay
the Freight due under it without deduction or set-off.
The Merchant warrants that in agreeing to the terms and
conditions in this Bill of Lading, he is the owner of
the Goods or he does so with the authority of the owner
4

7 days at $8 per day, 7 days at $20 per day, and 681 days
at $28 per day.
5

Pl.'s 56.1 statement is inconsistent with the Boose Decl.
in the exact amount MSC seeks with respect to Container '230. I
use the amounts listed in the Boose Decl. at ¶ 19.
7

of the Goods or of the Person entitled to the possession of the Goods or of this Bill of Lading.
(Boose Decl. ¶ 14 & Exhibit A § 2).
MSC's bill of lading also provides that:
The Carrier allows a period of free time for the use of
the Containers and other equipment in accordance with
the Tariff and as advised by the local MSC agent at the
Ports of Loading and Discharge. Free time commences
from the day the Container and other equipment is . . .
discharged from the Vessel or is delivered to the Place
of Delivery . . . . The Merchant is required and has
the responsibility to return to a place nominated by
the carrier the Container and other equipment before or
at the end of the free time allowed at the Port of
Discharge or the Place of Delivery. Demurrage, per
diem and detention charges will be levied and payable
by the Merchant thereafter in accordance with the
Tariff.
(Boose Decl. ¶ 15 & Exhibit A § 14.8).

MSC's bill of lading

further states that "[t]he Merchant shall take delivery of the
Goods within the time provide[d] for in the Carrier's Tariff or
as otherwise agreed" (Boose Decl. ¶ 15 & Exhibit A § 14.8).6

6

The bill of lading also defines "freight" as "includ[ing]
the freight and all charges, costs and expenses whatsoever
payable to the Carrier in accordance with the applicable Tariff
and this Bill of Lading, including storage, per diem and
demurrage," and, as a "merchant," the shipper is required to pay
the full amount of freight under the contract (Boose Decl.
Exhibit A §§ 2, 11, 20).
8

E.

Plaintiff's Claims
and Defendant's Arguments

MSC contends that it is entitled to summary judgment
because, under the bills of lading at issue, UAL, as the shipper,
is liable for demurrage and other expenses MSC incurred in
connection with UAL's delay in clearing, emptying, and returning
the containers to MSC.
UAL does not dispute the fact that MSC shipped the
containers and that the containers were never retrieved from the
ports.

Rather, UAL contends that: (a) there was no harm to

plaintiff because MSC could have replaced the containers with
others in its shipping system and MSC is "attempting to [ ]
create a windfall profit by relying on the fine print in its bill
of lading," (b) UAL, as a ocean transport intermediary, has no
ownership interest in the goods, (c) UAL had no right or authority to dispose of the cargo and return the empty container to
MSC, (d) UAL was acting as an agent for a disclosed principal,
(e) MSC substantially delayed the liquidation of the cargo in
Jordan, (f) plaintiff has provided no evidence that it is fault
free, (g) UAL should not be responsible for the wrongful acts of
the consignee, and (h) substantial issues of material fact exist
including the facts surrounding the delay in devanning the cargo
in Jordan and Kenya (Affidavit of Mohammad Tahir in Opposition to
9

Plaintiff's Motion for Summary Judgment, sworn to on Nov. 11,
2011 (Docket Item 21) ("Tahir Aff.") at ¶¶ 5-18).

III.

Analysis

A.

Summary Judgment Standards

The standards applicable to a motion for summary
judgment are well-settled and require only brief review.
Summary judgment shall be granted when there is no
genuine issue of material fact and the moving party is
entitled to judgment as a matter of law. Fed.R.Civ.P.
56(c). This form of relief is appropriate when, after
discovery, the party -- here plaintiff -- against whom
summary judgment is sought, has not shown that evidence
of an essential element of her case -- one on which she
has the burden of proof -- exists. See Celotex Corp.
v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 91
L.Ed.2d 265 (1986). This form of remedy is inappropriate when the issue to be resolved is both genuine and
related to a disputed material fact. An alleged factual dispute regarding immaterial or minor facts between the parties will not defeat an otherwise properly
supported motion for summary judgment. See Howard v.
Gleason Corp., 901 F.2d 1154, 1159 (2d Cir. 1990).
Moreover, the existence of a mere scintilla of evidence
in support of nonmovant's position is insufficient to
defeat the motion; there must be evidence on which a
jury could reasonably find for the nonmovant. Anderson
v. Liberty Lobby, Inc., 477 U.S. 242, 252, 106 S.Ct.
2505, 91 L.Ed.2d 202 (1986).
If the movant demonstrates an absence of a genuine
issue of material fact, a limited burden of production
shifts to the nonmovant, who must "demonstrate more
than some metaphysical doubt as to the material facts,"
and come forward with "specific facts showing that
there is a genuine issue for trial." Aslanidis v.
United States Lines, Inc., 7 F.3d 1067, 1072 (2d Cir.
10

1993). If the nonmovant fails to meet this burden,
summary judgment will be granted against it. Gallo v.
Prudential Residential Servs., 22 F.3d 1219, 1224 (2d
Cir. 1994).
Powell v. Nat'l Bd. of Med. Exam'rs, 364 F.3d 79, 84 (2d Cir.
2004); accord Jeffreys v. City of N.Y., 426 F.3d 549, 553-54 (2d
Cir. 2005); Gallo v. Prudential Residential Servs., 22 F.3d 1219,
1223-24 (2d Cir. 1994).
"Material facts are those which 'might affect the
outcome of the suit under the governing law,' and a dispute is
'genuine' if 'the evidence is such that a reasonable jury could
return a verdict for the nonmoving party.'"

Coppola v. Bear

Stearns & Co., 499 F.3d 144, 148 (2d Cir. 2007), quoting Anderson
v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986); accord McCarthy
v. Dun & Bradstreet Corp., 482 F.3d 184, 202 (2d Cir. 2007).
"'[I]n ruling on a motion for summary judgment, a judge must ask
himself not whether he thinks the evidence unmistakably favors
one side or the other but whether a fair-minded jury could return
a verdict for the [non-movant] on the evidence presented[.]'"
Cine SK8, Inc. v. Town of Henrietta, 507 F.3d 778, 788 (2d Cir.
2007), quoting Readco, Inc. v. Marine Midland Bank, 81 F.3d 295,
298 (2d Cir. 1996).
The party seeking summary judgment has the burden to
demonstrate that no genuine issue of material fact
exists . . . . In determining whether a genuine issue
of material fact exists, a court must examine the
11

evidence in the light most favorable to, and draw all
inferences in favor of, the non-movant . . . . Stated
more succinctly, "[t]he evidence of the non-movant is
to be believed."
Lucente v. Int'l Bus. Machs. Corp., 310 F.3d 243, 253-54 (2d Cir.
2002) (citations omitted); see also Jeffreys v. City of N.Y.,
supra, 426 F.3d at 553 ("'Assessments of credibility and choices
between conflicting versions of the events are matters for the
jury, not for the court on summary judgment.'"), quoting Rule v.
Brine, Inc., 85 F.3d 1002, 1011 (2d Cir. 1996); accord Make the
Road by Walking, Inc. v. Turner, 378 F.3d 133, 142 (2d Cir.
2004); Dallas Aerospace, Inc. v. CIS Air Corp., 352 F.3d 775, 780
(2d Cir. 2003).
"In moving for summary judgment against a party who
will bear the ultimate burden of proof at trial, the movant may
satisfy [its] burden by pointing to an absence of evidence to
support an essential element of the nonmoving party's claim."
Vann v. City of N.Y., 72 F.3d 1040, 1048 (2d Cir. 1995).

"A

defendant moving for summary judgment must prevail if the plaintiff fails to come forward with enough evidence to create a
genuine factual issue to be tried with respect to an element
essential to its case."

Allen v. Cuomo, 100 F.3d 253, 258 (2d

Cir. 1996).

12

Finally, the Court of Appeals for the Second Circuit
has explained that "in determining whether the moving party has
met [its] burden of showing the absence of a genuine issue for
trial, the district court may not rely solely on the statement of
undisputed facts contained in the moving party's Rule 56.1
statement.

It must be satisfied that the citation to evidence in

the record supports the assertion."

Vt. Teddy Bear Co. v.

1-800

Beargram Co., 373 F.3d 241, 244 (2d Cir. 2004); see also
Giannullo v. City of N.Y., 322 F.3d 139, 140-43 (2d Cir. 2003).
Even where, a summary judgment motion is unopposed, the Court
must examine the record to determine whether a genuine issue of
fact exists for trial; a summary judgment motion cannot be
granted on default.

Vt. Teddy Bear Co. v. 1–800 Beargram Co.,

supra, 373 F.3d at 244.

B.

Plaintiff's Claims for Demurrage

There is no material issue of fact with regard to MSC's
claims for demurrage.

There were two contracts between the

parties which consisted of the bills of lading and the tariffs
which were expressly incorporated into the contracts.

See Mo.

Pac. R.R. Co. v. Elmore & Stahl, 377 U.S. 134, 144 (1964) ("The
shipping contact consists of the bill of lading and applicable
tariffs lawfully published and filed, from which there nay be no
13

departure.") (internal citations omitted) (Douglas, J., dissenting); accord Orient Overseas Container Line Ltd. v. Crystal Cove
Seafood Corp., 10 Civ. 3166 (PGG), 2012 WL 463927 at *12
(S.D.N.Y. Feb. 14, 2012) (Gardephe, D.J.); Mediterranean Shipping
Co. (USA) v. Cargo Agents, Inc., 10 Civ. 5070 (THK), 2011 WL
6288422 at *4 (S.D.N.Y Dec. 15, 2011) (Katz, M.J.).

The con-

tracts between the parties were clear and unambiguous.

UAL, as

the shipper, was a "merchant" under the contracts (Exhibit A to
Boose Decl. at § 1).

As a merchant, UAL warranted that it was

"the owner of the [g]oods" or acted "with the authority of the
owner," and UAL agreed to be jointly and severally liable for all
"undertakings, responsibilities and liabilities" including paying
freight and demurrage charges (Exhibit A to Boose Decl. at §§ 2,
14, 16, 20).
"Demurrage is a standard fee associated with shipping
through common carriers; so much so that courts have found it to
be an implied term in maritime contracts."

Mediterranean Ship-

ping Co. (USA) v. Cargo Agents, Inc., supra, 2011 WL 6288422 at
*4, citing Safmarine v. Columbia Container Lines (USA), Inc., 10
Civ. 1825 (KAM), 2010 WL 7134001 at *3 (E.D.N.Y. Dec. 15, 2010)
("The [] obligation, 'to remove the goods within a reasonable
time and not to appropriate the space needed by the ship company

14

for other cargo,' is [] an implied term in the maritime contract
and falls on the shipper or consignee." (citations omitted)).
Any risk that prevents the discharge of cargo during
the stipulated freetime "should be borne by the cargo
interest, shipper or consignee, as the case may be."
[Gulf P.R. Lines, Inc. v. Assoc. Food Co., 366 F. Supp.
631, 635 (D.P.R. 1973) ("Puerto Rico")] (citing Yone
Suzuki v. Cent. Argentine Ry., 27 F.2d 795, 804 (2d
Cir. 1928); The Marpesia, 292 F. 957, 969 (2d Cir.
1923)).
Safmarine v. Columbia Container Lines (USA), Inc., supra, 2010 WL
7134001 at *3.

Thus, plaintiff is not attempting to reap a

"windfall profit" based on "fine print"; rather, it is only
attempting to collect fees to which it is entitled under a "longstanding industry practice and the terms of its agreement."
Mediterranean Shipping Co. (USA) v. Cargo Agents, Inc., supra,
2011 WL 6288422 at *4.
UAL's contentions that MSC delayed the liquidation of
the cargo in Jordan and that it provided no evidence that it is
fault free in the matter are also meritless.

Such contentions

are no more than conjecture and do not create disputes about
material issues of fact.

Mediterranean Shipping Co. (USA) v.

Cargo Agents, Inc., supra, 2011 WL 6288422 at *5.
UAL's other purported disputes of fact are also
meritless.

Any questions regarding the delay in devanning the

cargo in Jordan and Kenya are immaterial to MSC's claims for

15

demurrage.

Mediterranean Shipping Co. (USA) v. Cargo Agents,

Inc., supra, 2011 WL 6288422 at *5.

Under the contracts, UAL was

responsible for unloading the containers and returning them to
MSC during the free-time and it agreed to be liable for any
demurrage charges.

It simply makes no difference, with respect

to UAL's contractual obligations, that UAL had no ownership
interest in the goods, that UAL purportedly did not have the
authority to dispose of the goods, that it was acting as an
intermediary, or that the consignees wrongfully failed to pickup
the goods.

UAL is still liable to MSC for the resulting demur-

rage charges.7
Accordingly, I find that MSC is entitled to summary
judgement on its claims for demurrage.

C.

Damages

With respect to Container '365, MSC seeks $14,340 in
demurrage charges and $490 in other administrative fees and, with
respect to Container '230, MSC seeks $19,264 in demurrage charges
and $135 in other administrative fees (Boose Decl. ¶¶ 17, 19).

7

UAL also claims that it is entitled to a set-off if MSC
received proceeds from the liquidation of the goods in Jordan;
however, MSC did not receive any such proceeds (see Boose Decl. ¶
7).
16

UAL argues that MSC did not actually suffer a loss due
to the unavailability of the two shipping containers.

This

argument is unavailing:
Demurrage is an accepted form of liquidated damages in
shipping, see Ocean Transp. Line v. AM. Philippine
Fiber Ind., 743 F.2d 85, 90 (2d Cir. 1984); see also
Toyomenka Pacific Petroleum, Inc. v. Hess Oil Virgin
Islands Corp., 771 F. Supp. 63, 69 (S.D.N.Y. 1991)
("Demurrage has sometimes been described as stipulated
damages for detention.") (internal citations omitted),
and in any event, Plaintiff is not allowed to deviate
from its published tariff. See 46 U.S.C. § 41104.
While Plaintiff must show actual loss, that inquiry is
not used as the measure of damages where the contract
provides for a reasonable demurrage fee. See Marin Tug
& Barge, Inc. v. Westport Petroleum, Inc., 1 Fed. App'x
757, 759 (9th Cir. 2001) ("[T]he mere stipulation of a
liquidated sum for demurrage [does not] obviat[e] the
need to show actual damages. At the same time, the
requirement of proving actual damages does not vitiate
the [stipulated] demurrage rate . . . unless such a
rate is so excessive that it constitutes a penalty.")
(alterations in original) (internal quotations and
citations omitted). This rule has been established
since the earliest days of federal admiralty jurisprudence. See, e.g. The Apollon, 9 Wheat. 362, 22 U.S.
362, 378, 6 L.Ed. 111 (1824) ("In truth, demurrage is
merely an allowance or compensation for the delay or
detention of a vessel. It is often a matter of contract, but not necessarily so."). In other words, once
a plaintiff has demonstrated that there has been loss,
that is, the loss of the use of a container, the amount
of loss is measured by the demurrage rate.
Mediterranean Shipping Co. (USA) v. Cargo Agents, Inc., supra,
2011 WL 6288422 at *5.8

8

UAL also argues that MSC's damages are "illusory" as
evidenced by its offer of a 40% reduction in charges to settle
(continued...)
17

Accordingly, MSC is awarded $33,604 in demurrage
charges.

This figure is based on plaintiff's supporting declara-

tion and the printouts of the relevant tariffs (Boose Decl. 17,
19 & Exhibits D, G).
To the extent MSC seeks other administrative fees, its
motion is denied.

Although other fees are contemplated by the

bills of lading, these fees are not specifically delineated in
the bills of lading and are not listed in the tariffs provided.
No invoices for such fees are provided and MSC's declaration in
support of its motion does not adequately describe the nature and
circumstances surrounding these fees.

Accordingly, I do not find

sufficient proof regarding these fees to award them as a matter
of law.

D.

Interest

Plaintiff also seeks an award of interest on its
damages.
"Although it is an abuse of discretion to deny
prejudgment interest in admiralty cases except under

8

(...continued)
the matter (Tahir Aff. ¶ 13). Such evidence is immaterial to
plaintiff's claims and is inadmissable under Fed.R.Evid. 408.
Furthermore, although reductions in demurrage charges are not
normally allowed, see 46 U.S.C. § 41102, 41104, a relatively
inexpensive procedure can be used to waive a portion of demurrage
charges, see 46 C.F.R. § 502.271.
18

extraordinary circumstances, the district court has
broader discretion to determine when interest commences
and what rate of interest to apply." Independent Bulk
Transport, Inc. v. Vessel Morania Abaco, 676 F.2d 23,
25 (2d Cir. 1982) (internal citation omitted). In
admiralty, interest is meant to be solely compensatory.
See New York Marine & Gen. Ins. Co. v. Tradeline
(L.L.C.), 266 F.3d 112, 131 (2d Cir. 2001); O'Brien
Bros. v. The Helen B. Moran, 160 F.2d 502, 506. (2d
Cir. 1947).
Mediterranean Shipping Co. (USA) v. Cargo Agents, Inc., supra,
2011 WL 6288422 at *6.
Because interest is meant to be compensatory, and
Mediterranean will be sufficiently compensated through its
demurrage award for the lost use of its shipping containers, I
conclude that, with respect to Container '365, interest should
commence on October 5, 2011, the day it recovered Container '365,
and run until the entry of judgment.

With respect to Container

'230, interest should commence on October 24, 2011, the last day
this Order awards MSC demurrage charges, and run until the entry
of judgment.

The interest rate will be based on the average

4–Week Treasury Bill rate for that time period.

See Mediterra-

nean Shipping Co. (USA) v. Cargo Agents, Inc., supra, 2011 WL
6288422 at *6, citing N.Y. Marine & Gen. Ins. Co. v. Tradeline
(L.L.C.), supra, 266 F.3d at 131 ("Interest is intended to make
the injured party whole . . . and generally should be measured by
interest on short-term, risk-free obligations.”) (internal

19

quotation marks and citations omitted), and Dessert Serv., Inc.
v. M/V MSC Jamie/Rafaela, 219 F. Supp. 2d 504, 509 (S.D.N.Y.2002)
("The T-bill rate more closely parallels the income the damages
would have earned in a short-term, risk-free investment." (citation omitted)).

E.

Attorneys' Fees and Costs

MSC also seeks attorneys' fees and costs related to its
claims.

Although the contracts in this case provide that attor-

neys' fees and costs are recoverable, plaintiff's counsel has
submitted no time records reflecting the work for which they seek
fees or evidence of their hourly rate or costs.

Accordingly,

MSC's application for fees and costs is denied.

See

Mediterranean Shipping Co. (USA) v. Cargo Agents, Inc., supra,
2011 WL 6288422 at *7, citing Scott v. City of N.Y., 626 F.3d
130, 133 (2d Cir.2010), and N.Y. State Ass'n for Retarded Children v. Carey, Inc., 711 F.2d 1136 (2d Cir. 1983).

IV.

Conclusion

Accordingly, for all the foregoing reasons, plaintiff's
motion for summary judgement is granted with respect to demurrage
charges and pre-judgment interest and is denied with respect to
all other charges.

MSC is directed to advise me within fourteen
20

(14) days whether it wishes to pursue its claims for administra
tive fees and attorneys' fees.
other fees,

If MSC elects to forego these

the Clerk will be directed to enter judgment against

defendant for demurrage charges in the amount of $14,340 plus
interest calculated at the average 4-Week Treasury Bill rate for
the period between October 5, 2011 and the date of judgment and
in the amount of $19,264 plus interest calculated at the average
4-Week Treasury Bill rate for the period between October 24, 2011
and the date of judgment.
Dated:

New York, New York
August 29, 2012
SO ORDERED

HENRY PITMAN
United States Magistrate Judge
Copies transmitted to:
John A. Orzel, Esq.
Carroll, McNulty & Kull
570 Lexington Avenue
8th Floor
New York, New York 10022
Ronald Saffner, Esq.
377 Rector Place
Suite 5B
New York, New York 10956

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