Tuesday, December 31, 2013

Monica Textile Corp v The Tana case brief

Monica Textile Corp v The Tana case brief summary
US Court of Appeals for the 2nd circuit, 1991

  • Monica Textile, the shipper, engaged The Tana to transport a container from Africa to Savannah, Georgia.
  • The bill of ladind said that the total number of packages was one, because the single container rather than the 76 bales stowed therein was the package.
  • The goods were damaged in transit and Monica brought suit.
  • The carrier invoked liability to $500 pursuant to the COGSA liability limitation provision.

Meaning of Package:
  • Although there is no definition for package, the courts refer to the intent of the contracting parties, when it is clear and reasonable.
  • Standard Electrica case: the pallet is the relevant package.
  • Leathers best case: The “container revolution” added a new dimension to the problem and “package” is thus more sensibly related to the unit in which the shipper packe d the goods and described them than to a large metal object in which the carrier caused them to be “contained”. So, a container rarely should be treated as a package.
  • Functional economic test was inconsistent with Leather’s belts.
  • Mitsui decision: when a bill of lading discloses on its face what is inside the container and those contents may reasonably be considered COGSA packages, then the container is not the COGSA package. This case has been followed by other courts.

Class notes:
  • The general rule is that the container is not he package, normally look at how many packages are inside the container. The BOL normally states how many packages are inside the container.
  • It is still open to the parties if the container is a package.
  • The best description of how many packages there are is the BOL
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