Glyphics Media v. MV Conti Singapore

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DMC/SandT/03/11
Glyphics Media, Inc. v. M.V. Conti Singapore, and others
United States District Court, Southern District of New York: Hon. Naomi Reice Buchwald: Docket No. 02 Civ. 4398 (NRB): March 21, 2003.
BILL OF LADING: FORUM SELECTION CLAUSE: CARRIER: AGENCY

Summary
The District Court granted a motion to dismiss a suit against a foreign vessel operating common carrier and its United States agent on the basis of a forum selection clause in the carrierís bill of lading calling for the exclusive jurisdiction of the Indian courts.

DMC Rating Category: Confirmed

Case note contributed by attorney Alan M. Weigel of Healy & Baillie, LLP of New York. Healy & Baillie are the International Contributors to the website for the United States

Facts
Plaintiff Shippers sued Ocean World Lines ("OWL"), a non-vessel operating common carrier ("NVOCC"), under OWLís bill of lading, for delays in shipping cargo. OWLís bill of lading called for suits to be brought in the New York courts. OWL then joined the Shipping Corporation of India ("SCI"), a vessel operating common carrier, and Strachan Shipping Agency ("Strachan"), SCIís agent in the United States, as third-party defendants seeking indemnification. SCI and Strachan moved to dismiss the Complaint and the Third-Party Complaint on the grounds that the forum selection clause contained in SCIís bill of lading required all disputes to be brought in India.

Issues
The court held that burden was on OWL and the original plaintiffs to "make a strong showing" to overcome the presumption of enforceability of the forum selection clause contained within SCIís bill of lading. OWL alleged that India would not be an effective forum because of the severe back log of cases in India. OWL supported its argument with newspaper articles about the back log and both OWL and the plaintiffs asked the court to take judicial notice of a decision from the United States Court of Appeals for the Third Circuit where expert testimony on the alleged backlog was offered. SCI and Strachan, however, submitted an affidavit of an Indian maritime attorney stating that an admiralty action such as the instant case would be disposed of reasonably promptly if the plaintiff moved the action along.

Judgment
The Court found that the fact that OWL would be required to litigate the matter in the New York forum and then travel to India to litigate its claim against SCI and Strachan was not sufficient to rebut the presumption of enforceability of the forum selection clause. Further, such possibility was foreseeable given that the two contracts (namely, the bills of lading) each contained forum selection clauses, one for New York and the other for India. The Court was satisfied that the Indian forum would give the parties the protection guaranteed by the US Carriage of Goods by Sea Act of 1936. Finally, as an NVOCC, OWL acted as an agent for the shippers, not as an agent for SCI the vessel-operating carrier. Thus, if the shippers had a direct claim against SCI or Strachan, they were also bound by the Indian forum selection clause.

The Court granted SCIís and Strachanís motion to enforce the Indian forum selection clause and dismissed the action against SCI and Strachan. The Court found that the objections made by the shipper and OWL were insufficient to overcome the presumption of enforceability of SCIís forum selection clause.

Comments
This case is apparently the first post-Sky Reefer decision upholding an Indian forum selection clause. [The Sky Reefer was a decision of the US Supreme Court upholding a foreign (non-US) arbitration clause in a bill of lading.]

 

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